Ardern, holding back tears, said that it had been a tough five and a half years as prime minister and that she was only human and needed to step aside.
"This summer, I had hoped to find a way to prepare for not just another year, but another term - because that is what this year requires. I have not been able to do that," Ardern, 42, told a news conference, Reuters reported.
"I know there will be much discussion in the aftermath of this decision as to what the so called 'real' reason was... The only interesting angle you will find is that after going on six years of some big challenges, that I am human," she continued.
"Politicians are human. We give all that we can, for as long as we can, and then it's time. And for me, it’s time."
A ruling New Zealand Labour Party vote for a new leader will take place on Sunday; the party leader will be prime minister until the next general election. Ardern's term as a leader will conclude no later than Feb. 7.
Ardern said she was not stepping down because the job was hard, but because she believed others could do a better job.
Ardern became the world's youngest female leader in 2017 at the age of 37. Her last day in the office will be Feb. 7.
MNA/PR