As ever with Johnson, it’s a divisive move, with many politicians from all parties believing he should make way immediately.
But, with a Conservative leadership contest likely to take weeks or even months, somebody needs to take charge until a successor is elected.
Here’s what we know about what could happen next.
Can Boris Johnson stay on as caretaker Prime Minister?
There is no constitutional reason Johnson shoud not stay on as a caretaker Prime Minister.
Although he has resigned as Conservative Party leader he remains Prime Minister until officially stepping down or being forced out.
The UK does not have a formal constitutional role of a deputy or caretaker Prime Minister, instead broadly leaving it up to the governing party.
What happens if a Prime Minister is unable to do their job?
In the event of a Prime Minister suddenly resigning or dying it is left up to the cabinet to recommend an immediate successor to HRH The Queen.
This may be done with the expectation that the role is a temporary one, although technically the caretaker Prime Minister remains in place until resigning or being forced out.
Traditionally in Britain, Prime Ministers have not designated a particular person to take over from them should they be incapacitated, although if there is a Deputy Prime Minister they are seen as the natural person to take over.
During the pandemic Johnson named the then Foreign Secretary Dominic Raab as his Deputy Prime Minister, indicating that he would be his understudy to take over prime ministerial responsibilities should Johnson become ill.
When the Prime Minister was admitted to intensive care with Covid on March 27, 2020, Raab accordingly took over his day-to-day duties for around two weeks.
Could Dominic Raab step up again?
Should Johnson step down completely before a successor is chosen then Dominic Raab would certainly be one of the most likely options to temporarily take over.
However, any Conservative MP could step in with the approval of the party – and with the consent of the Queen.
Some have suggested that former Prime Minister Theresa May could take on the role until the leadership contest is completed.
How long will the leadership process take?
Any caretaker Prime Minister can expect to be in the role until the Conservative Party’s autumn conference in October.
The first stage is to arrive at a shortlist – with Conservative MPs putting their own names forward and the first two rounds of voting seeing the candidates who don’t meet a certain threshold of votes being eliminated.
Subsequent ballots see the candidate coming last leaving the process until only two are left – who then are subjected to a final vote by the party membership.
The official time scale will be set out by the Conservative Party’s 1922 Committee.
What happened following Margaret Thatcher’s resignation as Prime Minister?
Thatcher's resignation as Prime Minister came during a leadership contest sparked by Michael Heseltine.
She won the first round of voting but not with a large enough majority and stood down in the second round after it was made clear she would be unable to win subsequent votes.
Thatcher remained as Prime Minister until the contest was complete, officially resigning after John Major emerged victorious and became Conservative Party leader on Tuesday, November 27, 1990.
Technically Thatcher was a caretaker Prime Minister, but only for a matter of hours.