The 51-year-old boss parts company with the Lions after six years at the Den following an FA Cup semi-final and a 20th-place finish in the Championship this season
The Lions narrowly avoided relegation to League One this season, finishing two points clear of the relegation places in the Championship while also enjoyed a run to the semi-final of the FA Cup.
The 51-year-old former Swansea City boss took charge of Millwall in November 2007 and feels that it is now time for him to pursue a new challenge.
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Jackett led the south London outfit out of League One in 2010 and had been the longest-serving manager in the Championship and the sixth longest-serving in the entire Football League.
He resignation was reluctantly accepted by the Lions, with chairman John Berylson stating: "On behalf of the board, I want to express my thanks to Kenny for his fantastic service and achievements over the past five-and-a-half years.
"He has played a major role in creating a stable environment at Millwall which hadn't been the case prior to his arrival.
"On a personal level, whilst respecting Kenny's decision, I wish I could have persuaded him to change his mind. He was my first acquisition as chairman of the club and has proved himself to be one of the best. I am losing a great manager but he will remain a good friend and, hopefully, golf partner.
"We are now determined to move the club forward and build on the foundations Kenny has provided towards even greater success."