Blair had been the quartet's envoy, which consists of Russia, the US, United Nations and the European Union, shortly after resigning as British prime minister in 2007.
Following a controversial tenure in the role, where critics attacked the lack of progress achieved in the region, Blair handed in his resignation, according to The Associated Press.
The news comes amid speculation earlier this year that Blair was in discussions about changing his role as the quartet's envoy, after senior British diplomats were quoted in the Financial Times saying they wanted the former prime minister to move on from his position as envoy.
"It is long overdue. He has been ineffective in this job. He has no credibility in this part of the world."
The controversy continued with Blair bieng criticized for taking on dual roles as diplomat and businessman to various companies based in the Middle East, while three former British ambassadors backed a campaign calling for him to be sacked and accused him of trying to ''absolve himself'' of responsibility for the crisis in Iraq.
It had been reported in March that Blair's position as the quartet's envoy was viewed as "no longer tenable" by Washington and Brussels.