According to his letter "to the Apple Board of Directors and the Apple Community", posted on the Wall Street Journal website, Jobs said, "I hereby resign as CEO of Apple. I would like to serve, if the Board sees fit, as Chairman of the Board, director and Apple employee."
"I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple's CEO, I would be the first to let you know. Unfortunately, that day has come." He said he "strongly recommends" that Apple executes its succession plan and names Tim Cook as CEO of Apple.
"I believe Apple's brightest and most innovative days are ahead of it. And I look forward to watching and contributing to its success in a new role. I have made some of the best friends of my life at Apple, and I thank you all for the many years of being able to work alongside you."
A pancreatic cancer survivor, Jobs has been on medical leave for an undisclosed condition since January 17.
The visionary behind some of Apple's most iconic and bestseller products like the iPod, iPhone and iPad, Jobs is a pancreatic cancer survivor. Under his leadership, Apple revolutionised the music business through the iPod, the mobile business through the iPhone and the entertainment and media world through the iPad.
Earlier this month, with a market capitalisation of about USD 346 billion, Apple briefly surpassed energy major Exxon Mobil to become the country's most valuable company.
The news of Jobs' resignation came after the markets closed on Wednesday. In after-hours trading, Apple stock fell 5 per cent.
Jobs was diagnosed with a rare form of pancreatic cancer in 2004 and underwent a liver transplant two years ago. In a letter in January this year, he said he was taking another leave of absence to "focus on my health".
He, however, emerged briefly from his medical leave during the year on a few occasions. In March, he unveiled the second version of the revolutionary iPad and later attended a dinner hosted by President Barack Obama for technology tycoons in Silicon Valley.
In June, he was on stage in San Francisco to talk about iCloud, Apple's latest foray into cloud-based computing. Jobs' thin frame and gaunt appearance sparked questions about his health and for how long would he continue to be at the helm of Apple.
Jobs'' medical leave of absence also raised concerns of how the technology major, which he had co-founded in a garage, would succeed without Jobs.