Jan.11 (GMM) Williams has declined to comment on a wave of speculation about the British team's next moves.
Mercedes has now confirmed that Paddy Lowe has left the reigning champions and entered a period of 'gardening leave'.
"I am looking forward to a new challenge and wish everyone well at Mercedes," said Lowe.
It is believed the news is a precursor to the next steps at Williams.
With Pat Symonds retiring, Lowe has been linked as his likely successor as technical boss. But reports have actually suggested that Lowe will become the new Williams team boss, relegating Claire Williams to a role alongside her father.
According to the speculation, the length of Lowe's 'gardening leave' has been agreed between Mercedes and Williams, with the outcome now expected to lead to Valtteri Bottas' move to succeed the retiring Nico Rosberg.
If that happens, it will almost certainly mean Felipe Massa calls off his retirement.
"It's all so complicated," Mercedes team chairman Niki Lauda told the Swiss newspaper Blick.
Another rumour is that, with Lowe becoming Williams boss, James Key might be heading to Williams in 2018 to succeed the retiring Symonds.
When contacted, Williams declined to comment.
As for Mercedes, it is expected that Mercedes will soon replace Lowe with the Ferrari refugee James Allison.
But the reigning world champions said that "In the short term, our stable technical organisation" including Aldo Costa and Geoff Willis will continue their work.
"We have the talent in place to continue our success of recent years and we plan to build upon it in 2017 and beyond," said Mercedes boss Toto Wolff.
Mercedes said it will have more news on the matter "in due course".