Smith dropped the bombshell in his weekly press conference ahead of KR’s game against Wakefield Trinity on Saturday.
The 55-year-old intends to see out the rest of his contract before leaving his role in September.
“I won’t be coaching here beyond the end of this year,” said the Rovers head coach. “I’m going to step aside and hand it on to the next person to pick up.
“It’s the best thing for the organisation. I’ve enjoyed coaching this special group of players and I love the support I’ve been given here by all of the supporters.”
Smith took over from Tim Sheens at Craven Park in June 2019 and has transformed Hull KR’s fortunes.
The former Great Britain head coach took the Robins from the brink of relegation to the Super League semi-finals in the space of two years and the club are well placed in both competitions this season.
Rovers are sixth in the table on the back of five straight wins and can look forward to a Challenge Cup semi-final against Huddersfield Giants in early May.
Smith has been linked with a return to Headingley since Richard Agar’s departure last month but he was at pains to stress he has not agreed a deal elsewhere.
“Before anyone asks, I’ve not got the job at Leeds and I won’t be getting announced into another job,” said Smith. “It’s just a decision I’ve come to. I haven’t been in negotiations. We’ve not been talking about money; it’s just the right thing to do.”
Less than two hours later, Rohan Smith was unveiled as the new Leeds head coach on a three-and-a-half-year deal.
The former Bradford Bulls boss has been tasked with steering the Rhinos clear of relegation danger after just one win in nine Super League games.
“The opportunity to be a head coach in Super League is something I have always aspired to do and especially with a club with such a rich history in the game and a proud tradition of developing talent through their academy,” said Smith.
“As a development-minded coach, when I look back on my career, the clubs that I have enjoyed working at most are those who develop their own and I know that is part of the Rhinos way.”
The news only served to intensify speculation that Tony Smith will be returning to Headingley in some capacity later this year.
But Leeds chief executive Gary Hetherington has insisted that there is no link between Tony’s resignation and Rohan’s appointment.
“None at all, no,” said Hetherington. “That came as a surprise to me as Tony has done a terrific job for Hull Kingston Rovers so I was surprised.”
Hetherington does, however, see similarities between Rohan’s appointment and his decision to give Tony a chance in 2003.
“It does turn the clock back to appointing Tony Smith who wasn’t a big name at the time,” said Hetherington. “We came in for criticism from fans who thought we hadn’t appointed a big name at the time. Tony had limited experience and coached at Huddersfield of course but, as we all know, he proved to be the perfect coach at that time.”
“He had four great years and we’ll be forever grateful for the legacy he left and the success he enjoyed.
“Rohan comes in a bit more experienced than Tony, a little bit older, but with the same passion and zest for the game with ambition to achieve success, so that’s an interesting parallel.”