Tory leader Michael Howard will stand down to allow a younger leader to take over.
Mr Howard did not give a time but said it would be "sooner or later". He said he would stay as leader until the party had the opportunity to consider whether it wanted to change the rules for electing a successor.
He said the party could "hold its head up high" after its performance in the general election.
Mr Howard said there must never be a return to the "bickering and backstabbing of the past".
With few declarations remaining, the Tories have increased their number of seats to 196 - up 30 from 2001.
They took seats from both Labour and the Lib Dems, including Enfield Southgate from Schools Minister Stephen Twigg.
But Mr Howard said his age meant he could not lead the party into the next general election.
"I'm 63 years old. At the time of the next election in four or five years' time I'll be 67 or 68 and I believe that's simply too old to lead a party into government.
"So as I can't fight the next election as leader of our party I believe its better for me to stand aside sooner rather than later so that the party can choose someone who can.
"I want to avoid the uncertainty of prolonged debate about the leadership of the party.
"I want the next Conservative leader to have much more time than I had to prepare our party for government.
"If we've achieved this much in just 18 months imagine what we can achieve in the next four or five years."
However, Labour adviser Alastair Campbell said the Tories remained "flat on their backs".
Former Tory education spokesman Tim Collins, narrowly beaten in Westmorland and Lonsdale by the Lib Dems, said his party could have won more seats with a more positive campaign.
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