The Conservative leader has faced growing pressure from the 1922 Committee – a group of backbench MPs – to step down from the role.
Tensions have risen this week over the prime minister’s attempts to put forward her Brexit bill, leading to the resignation of Commons leader Andrea Leadsom, as well as public disagreement from MPs such as Boris Johnson and Dominic Raab.
Now, Theresa May has announced that she will stop being Prime Minister on June 7.
Speaking outside Downing Street, she said: 'Ever since I first stepped through the door as prime minister I have strived to make the UK a country that works for everyone.
‘I have done everything I can to get MPs to back the [Brexit] deal – sadly I have not been able to do so.
‘I will continue to serve until the process has concluded.
‘It is, and will always remain, a matter of deep regret to me that I have not been able to deliver Brexit.
‘Such a consensus can only be reached if those on all sides of the debate are able to compromise.’
The prime minister’s voice broke as she concluded her speech, saying that she ‘won’t be the last' female prime minister and has done her best in office.
The leadership contest is due to begin the week after Theresa May’s resignation – and she will serve until a new leader is able to take her place.