The automaker said it will keep a restructured organization in Russia to provide service to existing Toyota and Lexus customers.
Employees will be offered assistance for re-employment, re-skilling and well-being in addition to financial support above legal requirements, Toyota said.
Toyota currently employs 2,350 people in Russia. About 1,900 work at the St Petersburg plant and about 450 are employed in Moscow to oversee marketing, sales and finance operations.
"We think about 2,000 people will leave Toyota in Russia," the Toyota spokesman said. The workforce retained in Moscow will mainly continue to help existing customers in Russia with parts import and distribution.
Toyota sold just 221 vehicles in Russia in August, down 97 percent on the same month last year, according to the Moscow-based AEB Automobile Manufacturers Committee. The total market fell 62 percent to 41,698 units.
Last year, the Saint Petersburg plant built 42,235 RAV4s and 38,547 Camry sedans, according to Toyota.
With 38,441 units sold, the RAV4 was the 11th best-selling model in Russia last year, ahead of the Camry at 31,983 units, figures from the AEB show.
The factory began production in December 2007 after a 38 billion ruble investment (about 680 million euros at current exchange rates).