Cowell, 55, who has been the band's longtime mentor, said it is the perfect time for the band to take "some time off" and try other things, reported Billboard.
"In terms of the band, they've got enough hits now they can take some time off and do some other stuff they want to do," he said.
Cowell, who will be seen judging "The X Factor" with Nick Grimshaw, Rita Ora and Cheryl Fernandez-Verscin, said the band can get back together after their break.
"Then I hope they'll have a little bit of time apart and want to get back together again. It's a fun job, but it's absolutely their decision."
Earlier, One Direction's Harry Styles said the group was working on their forthcoming album.