Nancy Pelosi, who has served as the party’s leader in the US House of Representatives for almost 20 years, has announced her resignation.
The oldest and most influential Democrat in Congress, the 82-year-old is also the first female speaker of the House.
In the lower house of Congress, she will continue to represent her California district.
It happens at a time when projections indicate that Republicans will regain control of the House after the midterm elections.
Kevin McCarthy, a Republican, has secured his party’s candidacy for speaker of the incoming Congress and is likely to succeed Nancy Pelosi in that position.
“I never would have thought that someday I would go from homemaker to House speaker,” Mrs Pelosi said in a statement in the chamber on Thursday.
“I will not seek re-election to Democratic leadership in the next Congress. The hour has come for a new generation to lead the Democratic caucus,” she said.
Mrs Pelosi will serve as speaker until January when a new Congress takes over, and will remain in the seat she first took up in 1987 until January 2025.
New York Congressman Hakeem Jeffries is widely expected to take up the top Democratic leadership post in the House, which would make him the first black congressional leader in US history.