The announcement has come just a day after the Premier's lawyers made inroads in limiting the work of a public inquiry probing planning corruption in the 1990s.
He has been Ireland's leader for 11 years, but recent pressure about his financial inconsistencies have made his tenure impossible.
He referred to the "barrage of commentary" and said that the work of government has been "overshadowed by the work of the tribunal".
"I will not allow issues related to my own person to dominate the people and the body politic," he said.
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However, he added: “What I announce today is completely inspired by the desire to refocus the political dynamic in Ireland. Recent developments have not motivated my decision. For the record I state today that nothing could be further from the truth. I look forward to comprehensively dealing with these matters at the Tribunal and robustly refuting any imputation against me.
"I have never received a corrupt payment and I've never done anything to dishonour any office that I've ever held," he insisted.
Mr Ahern said it had always been his intention to review his position as Taoiseach and leader of Fianna Fail in the aftermath of next summer’s local and European elections.
"But having reflected on the need to ensure that the work of my ministerial colleagues is not distracted from by incessant publicity about the Tribunal, I have decided of my own volition to bring forward the date," he said.
It had been claimed, however, that Mr Ahern's position had become untenable after speculation he could be ousted by a vote of no confidence after several senior members of Mr Ahern's party failed to say they believed his version of events, as given in the Mahon Tribunal.
TD Brian Cowen, is said to be favourite to take over as Taoiseach.
(DW/VB/KMcA)
