Babar stepped down as captain of all three formats last year after Pakistan failed to make the knockout stage of the 50-overs World Cup, before returning as white-ball skipper in March ahead of the Twenty20 World Cup, where Pakistan did not make it to the Super Eight stage.
"It's been an honour to lead this team, but it's time for me to step down and focus on my playing role," Babar wrote in a post on X on Tuesday.
"Captaincy has been a rewarding experience, but it's added a significant workload. I want to prioritise my performance, enjoy my batting, and spend quality time with my family, which brings me joy.
"By stepping down, I will gain clarity moving forward and focus more energy on my game and personal growth."
In a statement on Wednesday, the Pakistan Cricket Board (PCB) said Babar's resignation was a "testament to his professionalism and commitment to Pakistan cricket."
"He believes that dedicating himself fully to his batting will enable him to play a more decisive role in the team's success in the shorter formats," the body added.
"The PCB acknowledges Babar’s contributions as white-ball captain, his ability to prioritise the team’s needs and his unwavering dedication to Pakistan cricket.
"The PCB will continue to support Babar Azam, recognising he still has much to offer both as a world-class batter and a senior statesman of the team."
Pakistan won just six of the 13 T20 matches they played under Babar in his second stint, and the 2009 champions were involved in the T20 World Cup's biggest upset when they were beaten by hosts United States.
He did not take charge of any one-day international matches.
Pakistan will host England in three tests starting in Multan on Monday, before travelling to Australia for ODI and T20 matches in November.
