The former prime minister denied his decision was linked to Theresa May's plan to introduce a new wave of grammar schools, insisting the timing was "coincidental".
He had previously said he planned to fight the 2020 general election but said today it "isn't really possible" to sit on the backbenches after being in No 10.
His resignation came as several Tory MPs expressed reservations about the current Prime Minister's plans for more selective schools during a House of Commons statement.
While Tory leader, Mr Cameron resisted backbench pressure to overturn Tony Blair's ban on new grammars.
His announcement comes two months after he quit as prime minister on July 13 in the wake of defeat in the EU referendum.
The former PM said at the time that he was "very keen to continue" as MP for Witney, which he has represented in the Commons since 2001, and said it was "very much my intention" to seek re-election in 2020.
But after considering his position over the summer he came to the conclusion he must quit politics.
He said Mrs May had "got off to a cracking start" and she had been "very understanding" about his decision.
"Obviously I'm going to have my own views about different issues," Mr Cameron told ITV News. "People would know that and that's really the point.
"As a former prime minister it is very difficult, I think, to sit as a backbencher and not be an enormous diversion and distraction from what the Government is doing."
Asked if Mrs May's grammar plans were linked to his decision, he replied: "This decision has got nothing to do with any one individual issue. The timing in that way, I promise, is coincidental."
Mr Cameron said there were "many good things" in the policy but refused to endorse the proposals.
"My announcement today is not about grammar schools, there's no connection with grammar schools, it's purely one of timing."
Mrs May said she was "proud to have served" in Mr Cameron's government and under his leadership "we achieved great things not just stabilising the economy but also making great strides on delivering serious social reform".
"His commitment to lead a one nation government is one I will continue to follow," the PM said. "I thank him for everything he has done for the Conservative Party and the country and I wish him and his family well for the future."
Former chancellor and close ally George Osborne said it was a "sad day", tweeting: "We came into Parliament together, had a great partnership + I will miss him alongside me on the green benches over the coming years. Sad day."
Mr Cameron said he would not be moving away from the constituency, where he has made his home with wife Samantha and their children.
He said he was yet to make any "firm decisions" about his future but will be looking at a "new life".
"I'm sure I will be remembered for keeping that pledge to hold a referendum when many people thought that promise would never be kept," he said.
"I hope people will also look back at the 11 years I was leader of the Conservative Party and six years as prime minister of our country as a time when we did create a stronger economy, a thousand people (in work) for every day I was prime minister.
"And we did make some important social reform. The Conservative Party went from being in the doldrums and getting beaten to being a modernising winning force in British politics. The historians will have to work that out. I will now be looking at a new life. I'm only 49. I hope I can still contribute in terms of public service and to the country."
Labour leader Jeremy Corbyn said he wished Mr Cameron "all the best for the future", adding he got on well with him on a "human level."
Mr Corbyn thanked the former PM for the "courtesy" he showed him.
Speaking as he arrived for a private dinner with the TUC general council in Brighton, Mr Corbyn also joked about the "advice" Mr Cameron said his mother would give him about what to wear.
The Treasury confirmed that Mr Cameron had been appointed to the office of Steward and Bailiff of the Manor of Northstead, the arcane method by which MPs resign from the House of Commons.
The post carries no salary or responsibilities, but as a Crown appointment renders the holder ineligible to sit as an MP.
AP
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