The National Health and Family Planning Commission was the agency responsible for managing the country's birth limits and fining parents for unauthorized births.
But the commission is one of the 15 ministries and agencies President Xi Jinping is cutting in an effort to streamline government.
It will instead be replaced by a health commission that is responsible for several policies, including family planning, according to state-run media.
While family planning policies may still exist, for the first time since 1981, 'family planning' will not appear in the name of any government department. This could indicate a large shift away from the government placing importance on birth limits in the country.
In 2015, China announced it would end the controversial "one-child policy," and allow families where a parent had no siblings to have a second child.
At the time, the reason appeared to be largely driven by China's ageing population, and the need to increase the number of young people that could enter the workforce and care for the elderly.
But lifting the limit doesn't appear to have worked. In 2017, 630,000 fewer babies were born than in the previous year, a trend which could be driven by concerns over the cost and logistics of raising children.
Ahead of China's annual legislative meeting, the National People's Congress, a delegate floated the idea of a three-child policy and said that, if the country's birth rate couldn't be turned around, the family planning policy should be scrapped.
But Wang Peian, the deputy director of the National Health and Family Planning Commission, told financial news agency Caixin on Monday that China does not intend to loosen family planning policies and would first need to review the two-child policy.
With that commission now scrapped it is unclear if Wang's position is the same as that of government leaders.
China's decades-long one-child policy was very controversial. The policy was blamed for abortions, a nation-wide gender imbalance, and for millions of unregistered girls.
There were even reports of authorities jailing relatives of parents who had two children until the mother agreed to sterilization.
Receive a single WhatsApp message every morning with all our latest news. Sign up here.