The 35-year-old and his relatives have reportedly tried to secure his leadership of the conservative Austrian People’s Party and the country, using manipulated polls and friendly media reports, funded by public money.
He denies any wrongdoing and said he will “refute and refute the charges that have been brought”.
Mr Kurz added that the allegations, revealed by prosecutors on Wednesday, are “false and I will be able to clarify this – I am deeply convinced of it”.
He will remain very active in politics, remaining at the head of his party while being at the head of his parliamentary group.
His departure from the leadership post was rushed by his party’s junior coalition partner, the Greens, who said on Friday he could not stay, while demanding that his party appoint someone “beyond reproach” to replace it.
The three Austrian opposition parties had all demanded his resignation and a motion of censure was scheduled to be tabled against him in parliament on Tuesday.
Mr Kurz suggested that Foreign Minister Alexander Schallenberg replace him as Chancellor, to which the Greens have yet to respond.
He told reporters that Austria needed “stable conditions”, adding: “So in order to break the deadlock, I want to make room for the prevention of chaos and ensure stability.”
Mr Kurz’s first coalition, with the far-right Freedom Party, collapsed in 2019. He decided to break the deal after a video was released showing the leader of the Freedom Party in then, Heinz-Christian Strache, appearing to be offering favors to a so-called Russian investor.
Mr Kurz resumed his duties in January 2020 after an early election.