He is about to start his own business and also feels he has developed the festival to its greatest potential with the resources available.
Mr Thomas will wrap up three years in the role on July 28, when he will seek contract work before starting his own business in the middle of next year.
He would not disclose details of the new business, and said the only way to give the venture the "energy" it needed was to resign.
"The fringe job is all encompassing ... I care deeply about it ...
"It’s one of those jobs you’ve got to be passionate and committed to, and I certainly have been."
The festival had grown in his three years at the helm, on "tight budgets" and resources.
"I’m an ideas guy, I’m very ambitious, and I think fringe and I have gone as far as we can within those constraints.
"I’ve done as much as I can and for me it’s the right time to step away and I’m thrilled with where I’ve got things."
Art and culture was under-resourced in Dunedin, which was detrimental to the community.
"I think we need to do better."
The Dunedin City Council was "doing their bit, but I think we have a long way to go".
He was supported by a part-time administrator and he hoped funding would one day allow for the position to become full-time.
At least half of the job was "seeking, securing and reporting on funding and sponsorship to keep us afloat".
"We raise our entire operating budget every 12 months, so it’s a ceaseless cycle."
The director was also responsible for the New Zealand Young Writers Festival and the Amped Music Project.
The highlights of his tenure included the evolution of the opening night showcase, the permanent Fringe HQ in Princes St, and the Festival Club operating in the Community Gallery next door during the festival.
Applications for the director’s position would remain open until Monday, he said.
