In a statement, the former London mayor, who was suspended in 2016 for claiming Hitler supported Zionism in the 1930s, said he was leaving with “great sadness”.
He said that he continued to reject the allegation that he had brought the party into disrepute and insisted he was in no way guilty of anti-Semitism.
“After much consideration, I have decided to resign from the Labour Party,” he said. “The ongoing issues around my suspension from the Labour Party have become a distraction from the key political issue of our time – which is to replace a Tory government overseeing falling living standards and spiralling poverty, while starving our schools and the NHS of the vital resources they need.”
Labour leader Jeremy Corbyn said: “Ken Livingstone’s resignation is sad after such a long and vital contribution to London and progressive politics, but was the right thing to do.”
While Mr Livingstone rejected the charge of anti-Semitism, he acknowledged some of his comments had caused offence in the Jewish community, for which he was “truly sorry”.
“I abhor anti-Semitism, I have fought it all my life and will continue to do so,” he said.
“I also recognise that the way I made a historical argument has caused offence and upset in the Jewish community. I am truly sorry for that.”