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Starmer, who will stay until his successor is chosen, delivered a dignified speech in Downing Street, recognising that he has lost the support of his party.
Pressure had been building after a series of U-turns and scandals, low popularity ratings and damaging electoral defeats.
A tipping point was reached when the man set to replace him, Andy Burnham, won a convincing by-election victory last week, paving the way for a leadership challenge.
Burnham, a career politician and former minister, spent the last nine years as mayor of Greater Manchester. If unchallenged, he could be prime minister next month.
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