Alex Salmond will also resign as leader of the Scottish National Party (SNP), which he has led for a total of 20 years.
Scottish voters backed the country staying in the UK by 2,001,926 votes to 1,617,989 in Thursday’s referendum.
Meanwhile, Queen Elizabeth II has said Scotland’s vote to stay in the Union was “a result that all of us throughout the United Kingdom will respect”.
She added: “Knowing the people of Scotland as I do, I have no doubt that Scots, like others throughout the United Kingdom, are able to express strongly-held opinions before coming together again in a spirit of mutual respect and support.”
Dozens of rival Union and independence supporters have gathered in George Square, in the centre of Glasgow, where they are being separated by police. Officers on horseback are also at the scene.
A spokeswoman for Police Scotland said there were about 100 people in each of the two groups, and although there had been some “minor disorder” it had been dealt with quickly, with no arrests so far. The square is closed to traffic with local diversions in place.
The square had hosted a party by “Yes” supporters ahead of the referendum.
UK’s PM David Cameron said the three main Westminster parties would now deliver their campaign pledge to boost the powers of Scotland’s devolved parliament.
Alex Salmond, 59, is Scotland’s longest-serving first minister, having held the post since the SNP won power at the Scottish Parliament in May 2007.
Speaking from his official residence at Bute House in Edinburgh, the first minister told journalists: “For me as leader my time is nearly over, but for Scotland the campaign continues and the dream shall never die.
“I am immensely proud of the campaign that Yes Scotland fought and particularly of the 1.6 million voters who rallied to that cause.”
Alex Salmond said he would resign as SNP leader at the party’s conference in November, before standing down as first minister when the party elects its next leader in a membership ballot.
He said there were a “number of eminently qualified and very suitable candidates” to replace him.
Nicola Sturgeon, the current deputy first minister and deputy SNP leader, is seen as a clear frontrunner.
Alex Salmond, who will stay on as MSP for Aberdeenshire East, added: “It has been the privilege of my life to serve Scotland as first minister.
“But, as I said often during the referendum campaign, this is not about me or the SNP. It is much more important than that.
“The position is this. We lost the referendum vote but can still carry the political initiative. More importantly Scotland can still emerge as the real winner.”
Nicola Sturgeon said she could “think of no greater privilege than to seek to lead the party I joined when I was just 16,” but said she would not make an announcement today.
She added: “Alex Salmond’s achievements as SNP leader and Scotland’s first minister are second to none. He led the SNP into government and has given our country a renewed self confidence.”
Alex Salmond also used his resignation statement to question David Cameron’s more powers pledge.
“We now have the opportunity to hold Westminster’s feet to the fire on the ‘vow’ that they have made to devolve further meaningful power to Scotland,” he said.
“This places Scotland in a very strong position.
“I spoke to the prime minister today and, although he reiterated his intention to proceed as he has outlined, he would not commit to a second reading vote (in the House of Commons) by 27 March on a Scotland Bill.
“That was a clear promise laid out by Gordon Brown during the campaign.
“The prime minister says such a vote would be meaningless. I suspect he cannot guarantee the support of his party.”
On referendum night, 28 of Scotland’s 32 local authority areas voted in favor of staying in the UK.
Glasgow, Scotland’s largest council area and the third largest city in Britain, voted in favor of independence by 194,779 to 169,347.
The 75% turnout in Glasgow was the lowest in the country, and hoped for breakthroughs in other traditional Labour strongholds such as South Lanarkshire, Inverclyde and across Ayrshire never materialized for the nationalists.
Edinburgh, Scotland’s capital, clearly rejected independence by 194,638 to 123,927 votes, while Aberdeen City voted “No” by a margin of more than 20,000 votes.
Across Scotland, 84.6% of registered voters cast their ballot in the referendum – a record for a national election.
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