John E. Potter, one of the nation's longest serving postmasters general, announced Monday that he will retire in December.
Patrick R. Donahoe, currently deputy postmaster general, was named to succeed him by the post office's board of governors.
A New York City native, Potter has served in the Postal Service for 32 years and took over the top job at the agency on June 1, 2001.
Potter has served during a time that has seen the Postal Service struggle to deal with rising costs and a declining mail volume as people switch over to the Internet.
The post office continues to face losses despite cuts in its spending and staff. It does not receive tax dollars for operations.
Currently the agency is facing a $6 billion loss, and a request for a 2-cent increase in the price of a stamp was recently turned down by the independent Postal Regulatory Commission. The post office is appealing that decision.
The post office has also asked Congress for permission to reduce delivery to five-days-a-week and to eliminate or reduce the requirement that it contribute some $5 billion annually to a fund to pay in advance for retire health benefits.
Potter did not state a specific reason for announcing his retirement. He turned 55 in September.
When he leaves office Dec. 3 he will have been postmaster general for nine years and six months. Only Gideon Granger, postmaster general from 1801 to 1814, held the job longer.
Louis J. Giuliano, chairman of the postal governing board, called Potter "a steadying and farsighted leader throughout a period of dynamic change in America's use of the mail and during times of economic uncertainty."
"The hallmark of your success was your ability to build respectful relationships with all stakeholders, customers and employees that built a trusted level of credibility. We unreservedly regard your tenure as one of great accomplishment," Giuliano said in a statement.
Potter enacted "key reforms to modernize the Postal Service and put it on a more sustainable financial path," said Sen. Tom Carper, D-Del., chairman of a Senate Homeland Security and Governmental Affairs subcommittee that oversees the post office.
Potter, who rose through the ranks, expressed pride in the performance of postal employees, saying, "It is our people that define our organization and it is their dedication and sense of purpose that drives our business."
During his term Potter has cut some $20 billion in costs, increased use of automation, reduced the number of career employees from 787,000 in 2001 to about 584,000 today, and created a 10-year action blueprint for operational, legislative and regulatory changes.
Potter also led the agency through the anthrax-by-mail terrorist attack following 9/11.
Donahoe began his career as a clerk in Pittsburgh in 1975, and in 2001 became responsible for all facets of mail operations.