The IMF's executive board released a letter from the French executive late on Wednesday in which he denied the allegations against him, but said he felt compelled to resign "with sadness''.
"It is with infinite sadness that I feel compelled today to present to the executive board my resignation from my post of managing director of the IMF," Strauss-Kahn said in his letter of resignation.
"To all, I want to say that I deny with the greatest possible firmness all of the allegations that have been made against me," the statement added.
"I think at this time first of my wife - whom I love more than anything - of my children, of my family, of my friends.
"I think also of my colleagues at the fund; together we have accomplished such great things over the last three years and more.
"I want to protect this institution which I have served with honour and devotion, and especially - especially - I want to devote all my strength, all my time, and all my energy to proving my innocence."
The IMF's previous second-in-command John Lipsky will remain as acting managing director.
Also their are some critisism against him in the procedure he followed when providing Funds to countries which are very much biased towards dictatorship and/or does anti democtratic acts.
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