O'Connor, 75, said she expects to leave before the start of the court's next term in October, or whenever the Senate confirms her successor. There was no immediate word from the White House on who might be nominated to replace O'Connor.
It's been 11 years since the last opening on the court, one of the longest uninterrupted stretches in history. O'Connor's decision gives President Bush his first opportunity to appoint a justice.
"This is to inform you of my decision to retire from my position as an associate justice of the Supreme Court of the United States, effective upon the nomination and confirmation of my successor," she said in a one-paragraph letter to Bush. "It has been a great privilege indeed to have served as a member of the court for 24 terms. I will leave it with enormous respect for the integrity of the court and its role under our constitutional structure."
O'Connor's retirement came amid speculation that the aging court would soon have a vacancy. But speculation has most recently focused on Chief Justice William H. Rehnquist, 80, and suffering from thyroid cancer. Rehnquist has offered no public clue as to his plans.
The White House has refused to comment on any possible nominees, or whether Bush would name a woman to succeed O'Connor. Her departure leaves Justice Ruth Bader Ginsburg as the only other woman among the current justices.
Possible replacements include Attorney General Alberto R. Gonzales and federal courts of appeals judges J. Michael Luttig, John Roberts, Samuel A. Alito Jr., Michael McConnell, Emilio Garza and James Harvie Wilkinson III. Others mentioned are former Solicitor General Theodore Olson, lawyer Miguel Estrada and former deputy attorney general Larry Thompson, but Bush's pick could be a surprise choice not well known in legal circles.
Another prospective candidate is Edith Hollan Jones, a judge on the 5th U.S. Circuit Court of Appeals who was also considered for a Supreme Court vacancy by President Bush's father.
O'Connor's appointment in 1981 by President Ronald Reagan, quickly confirmed by the Senate, ended 191 years of male exclusivity on the high court.
She wasted little time building a reputation as a hard-working moderate conservative who emerged as a crucial power broker on the nine-member court.
O'Connor often lines up with the court's conservative bloc, as she did in 2000 when the court voted to stop Florida presidential ballot recounts sought by Al Gore, and effectively called the election for Bush.
As a "swing voter," however, O'Connor sometimes votes with more liberal colleagues.
Perhaps the best example of her influence is the court's evolving stance on abortion. She distanced herself both from her three most conservative colleagues, who say there is no constitutional underpinning for a right to abortion, and from more liberal justices for whom the right is a given.
O'Connor initially balked at letting states outlaw most abortions, refusing in 1989 to join four other justices who were ready to reverse the landmark 1973 decision that said women have a constitutional right to abortion.
Then in 1992, she helped forge and lead a five-justice majority that reaffirmed the core holding of the 1973 ruling. Subsequent appointments secured the abortion right. Commentators called O'Connor the nation's most powerful woman, but O'Connor poo-poohed the thought.
"I don't think it's accurate," she said in an Associated Press interview.
O'Connor in late 1988 was diagnosed as having breast cancer, and she underwent a mastectomy. She missed just two weeks of work. That same year, she had her appendix removed.
For years, O'Connor had an involuntary nodding of her head, but said she never had it diagnosed. The movement, while not constant, was an up-and-down motion similar to that made by someone nodding in the affirmative.
O'Connor remained the court's only woman until 1993 when, much to O'Connor's delight and relief, President Bill Clinton appointed Ginsburg.
The enormity of the reaction to O'Connor's appointment had surprised her. She received more than 60,000 letters in her first year, more than any one member in the court's history.
"I had no idea when I was appointed how much it would mean to many people around the country," she once said. "It affected them in a very personal way. People saw it as a signal that there are virtually unlimited opportunities for women. It's important to parents for their daughters, and to daughters for themselves."
At times, the constant publicity was almost unbearable. "I had never expected or aspired to be a Supreme Court justice. My first year on the court made me long at times for obscurity," she once said.
On the court, O'Connor generally favored states in disputes with the federal government and for enhanced police powers challenged as violative of asserted individual rights.