Holden is to stop funding the most successful team in Supercars history but will continue to maintain a factory team in the championship for the next three seasons.
The decision ends a 26-year relationship between the manufacturer and Walkinshaw Racing which delivered six drivers' championships and seven Bathurst 1000 crowns.
Formed in 1990 as the successor to Peter Brock's Holden Dealer Team, HRT won the 1996, 1998 and 1999 titles with Craig Lowndes before Mark Skaife claimed a hat-trick of titles from 2000-02.
Holden says the decision to back Triple Eight over Walkinshaw was based on recent results.
Since switching from Ford to Holden in 2010, Triple Eight have won four of the past five championships and consistently outperformed Walkinshaw's pairing of James Courtney and Garth Tander.
HRT principal Ryan Walkinshaw said despite Holden's decision, he was committed to running a two-car team in 2017.
"We are naturally disappointed but respect Holden's decision," Walkinshaw said.
"Racing is in our blood. We love competition, and we remain steadfast in our commitment to find our way back to the top of Supercars.
"With change comes opportunity, and we are as committed as ever to deliver on the track."
Holden's funding announcement means there will be at least one-factory backed team on the Supercars grid for the next three years.
Swedish giant Volvo will pull its support from Garry Rogers Motorsport at the end of the year while Ford stopped factory-funding in Supercars two years ago.
Nissan is yet to confirm if it will remain in the championship as a factory outfit next year but Holden's decision to commit may help the Japanese brand to stay on board.
Holden chairman Mark Bernhard said the manufacturer would continue to work with Walkinshaw Racing in a non-factory support role but to maintain a presence in Supercars, a decision on funding had to be made.
"We need to look at this from our overall business perspective," Bernhard said.
"We're certainly really excited, we're committing to the sport and I think our fans should be very pleased about that."
As part of the new arrangement, Triple Eight will rebrand their team to Red Bull Holden Racing Team from next season and it will also be responsible for developing, building and racing a next-generation Commodore from 2018.
"We're thrilled and honoured that we've been chosen as the factory team at a time when they're reducing their involvement to the one full team," team principal Roland Dane told AAP.
"We don't underestimate the importance or the value, at all, of their backing."
The news casts further doubt over the future of Tander and Courtney, with both HRT drivers off-contract.
Supercars is delighted to have three more years of Holden commitment and said it would do all it could to support Walkinshaw Racing.
"We will continue to work with Walkinshaw Racing to ensure it remains an integral part of the championship," Supercars chief executive James Warburton said.
"It is one of the most popular teams in our sport and we look forward to them continuing to be part of Supercars for many years to come."