Former UK prime minister Tony Blair is to step down as the representative of the Quartet of Middle East power brokers.
Blair wrote to Ban Ki-moon, the UN secretary-general, on Wednesday stating that he would resign from the role he has held for eight years.
The decision will come into effect at the end of June, a source close to the Quartet said.
In a statement on Wednesday, the Quartet "expressed its deep appreciation to Tony Blair as he plans to step aside as the Quartet's Representative".
"As the Quartet’s envoy on the ground during the last eight years, Mr Blair demonstrated an unwavering commitment to the cause of Israeli-Palestinian peace and made lasting contributions to the effort to promote economic growth and improve daily life in the West Bank and Gaza," the statement said.
"The Quartet thanks Mr Blair for his remarkable service and reaffirms its commitment to advancing peace and prosperity for Israelis and Palestinians."
Blair is expected to remain active in the region, but not in any formal capacity.
It is unclear whether a new representative of the Quartet, which brings together the US, Russia, the EU and the UN, will be appointed.
When Blair's appointment was announced in 2007, he took on the role eight months after it had been vacated by James Wolfensohn, a former World Bank president.
Blair, UK prime minister from 1997 until stepping down in 2007, attempted to be active in Middle East diplomacy at a time when international brokers had largely failed to bring Israel and the Palestinians closer to a resolution of their differences.
Peace negotiations brokered by the US last broke down a year ago, in disputes over illegal settlement building by Israel on occupied Palestinian land and prisoner releases sought by the Palestinians.
A source close to Blair, speaking on condition of anonymity, said he would "concentrate on strengthening relations between Israel and the wider Arab world," focusing more on regional diplomacy.
Blair also planned to "focus on encouraging Israel to take measures to dramatically improve the daily lives of Palestinians in Gaza," where 2,100 Palestinians, 67 Israeli soldiers and six civilians died and thousands of Gaza homes were devastated in last year's war, the source said.