Khanafar was credited with having revolutionised the Arab media landscape after he grew both the channel's reputation and its international distribution footprint.
The Palestinian-born journalist said in his resignation letter that he has reached his target of establishing Al-Jazeera "as a global media leader", and so has "decided to move on".
"In 2011 the eyes of the world watched the aspirations of millions unfold as our newsrooms broadcast, tweeted and published the events unfolding in the Liberation Squares from Sidi Bouzid to Jisr Al-Shughur," Khanfar wrote.
"The coverage of these revolutions is ongoing, and we continue to report the fight of the youth to achieve dignity and freedom from tyranny and dictatorship.
"I am fortunate to have had eight years working with an outstanding group of professionals. Today, Al-Jazeera stands as a mature organisation and I am confident that the organisation will continue to maintain its trailblazing path."
The channel's new director-general is said to be Sheikh Ahmed bin Jassim Al Thani, a member of the Qatari ruling family and an executive at Qatargas.
An Al-Jazeera spokesman said: "Wadah Khanfar had made outstanding contributions to Al-Jazeera and journalism worldwide. We all recognise his commitment to courageous reporting and want to continue to build upon those achievements."
Al-Jazeera rose to prominence during the US-led war in Afghanistan in 2001 when it became the first network to air recorded statements by Osama Bin Laden.
The channel launched an English network in international territories in 2006.
Al-Jazeera was widely praised for its coverage of the Arab Awakenings that spread across the Middle East this year, but it has more recently been criticised for holding back in coverage of the uprisings in the Gulf State of Bahrain. The network also rarely reports on events in Qatar itself.
Blake Hounshell, of Foreign Policy magazine, tweeted: "Whatever you think of Al-Jazeera's coverage, there's no question @khanfarw [Khanfar] put the network on the global map. Big time."
Khanfar's resignation comes as the first-ever Jewish news network commences broadcasting in Europe, North America and the Middle East, billed as an alternative to Al-Jazeera.