Brown said his Labour Party, which came a distant second in Thursday's national election, would begin a leadership contest to replace him as he focused on talks aimed at breaking Britain's election deadlock.
"As leader of my party I must accept that as a judgment on me," Brown said, referring to Labour's poor showing in the election.
Brown's comments came as the Conservatives, who won the most seats in the election but not a majority, were already holding talks with the Liberal Democrats. Some lawmakers said those talks had stalled over differences on key issues, including reform of the voting system.
In a statement outside Downing Street, Brown said Liberal Democrat leader Nick Clegg had asked to begin formal coalition talks with the Labour Party and the two could form a center-left alliance.
Clegg had previously said Brown's departure would likely be a condition of any deal with Labour.
"There is a progressive majority in Britain and I believe it could be in the interests of the whole country to form a progressive coalition government," Brown said.
Brown said he hoped a new Labour leader would be appointed at the party's annual convention in September. Foreign Secretary David Miliband and Education Secretary Ed Balls will likely be leading contenders to succeed Brown.
