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Bouteflika, 82, has been president of Algeria since 1999.
Algerian President Abdelaziz Bouteflika will retire before the expiry of his term on April 28, Algerian media reported.
Aged 82, in power for 20 years, he will ensure the "continuity of state institutions" before resigning, announced a presidential statement of the APS news agency.
The news comes after weeks of mbad protests demanding his resignation.
As a result, he had abandoned his proposal for re-election for a fifth term.
The elections were postponed and the government promised to hold a national conference that would discuss reforms to counter discontent.
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Until now, it was not known when and where he was going to retire, say observers.
Ahmed Rouaba, of the BBC, said that many Algerians felt that the health of this octogenarian had declined so much that it was now used as a facade by a group of businessmen, politicians and politicians. military officials known as "the power", who do not want to give up their influence.
This group dominates the National Liberation Front (FLN), which has headed Algeria since the independence of France in 1962.
The protesters demand the departure not only of the president, but also of a whole generation of Algerian political leaders, including those who would like to replace him.
The majority of protesters are young people who are not involved in party politics and say that they want a new system of government, not just a replacement for the troubled president.
Last week, the Algerian army chief of staff, General Ahmed Gaed Salah, demanded that the president be declared unfit to govern.
Last month, Bouteflika, who has rarely been seen in public since his 2013 stroke, also announced a major cabinet reshuffle.
The demonstrations against Bouteflika began two months ago after the president announced his intention to run for another term.
But people continued to walk even after he agreed not to stand, demanding instead an immediate change.
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