In announcing his decision, Hansen (59) said while he still had the desire, energy and commitment to continue in the role - as well as the support of the All Blacks and New Zealand Rugby - he felt that the end of the 2019 season was the right time to stand down so he could spend more time with his family.
"If I had a lack of passion I'd be finishing today. I want to thank all the people for the support, but at the end of the day it's my call and I know whats right for me and my family."
Hansen has been Head Coach of the All Blacks since 2012 and prior to that was an Assistant Coach for eight years.
"After being involved in the All Blacks for 16 years, I do feel it's right for the team for me to stand down. I think change after the Rugby World Cup will bring a new outlook for the team and it'll be time for someone else to enhance the legacy of the All Blacks."
Hansen said there had been no pressure from his family to step aside.
"As only people who have done the job will understand, there are not only heavy demands on yourself, but also on your family. My family has given me unreserved love and support over the last 16 years and I feel it's now time to make them the sole focus."
"It's been a huge privilege to be part of the All Blacks for such a long time and I'm really looking forward to, and excited by the challenges, of the next 12 months.
"We'll be attempting to do something that has never been done before - to win three consecutive Rugby World Cups. I'm highly motivated by that, as is the whole group, and we're really looking forward to it."
Hansen said he wanted to make the announcement about his future now so that New Zealand Rugby had plenty of time to identify a successor.
"This is a critical process which shouldn't be rushed and shouldn't be made in the turbulent period that tends to follow a Rugby World Cup campaign."
He had been thinking about the decision for a while.
"I just felt the time was right. You've got to go at some stage and I didn't want to get the chop. I've surrounded myself with good people who have helped me make this decision."
"I made the decision a wee while ago to be fair. I talked with my family about it a lot, and to Tewy [New Zealand Rugby CEO Steve Tew]. It doesn't weigh heavy on me because I know it's the right thing to do. It allows us to get on with things."
Hansen said he hadn't made any decision on his future at this stage and his focus was on preparing for the 2019 season.
He said he did not have any other coaching roles lined up.
"I haven't thought about what I will do after the World Cup.
"It is such a great privilege to coach the All Blacks and I am focused on nothing more than the next 21 months as we have an incredible opportunity to do something that no other team has ever done before," he said.
"I have no regrets about making the decision and feel good about it."
Tew said Hansen had overseen "one of the richest periods in All Blacks history".
"On his watch the All Blacks have had a winning rate of close to 90 percent - a remarkable run of sustained success.
"As well as his success on the field, he will also be remembered for his bold selections and the way he and his management team provided the opportunity and environment for the players to achieve their full potential on the international stage.
"He cares deeply about the game and the wider issues facing it and his views are hugely respected not only in New Zealand but internationally."
New Zealand Rugby Chairman Brent Impey has led the tributes to Hansen:
"On behalf of the New Zealand Rugby Board, I'd like to thank Steve for his enormous contribution to our national game. He's hugely respected, clear in his views, and will leave the job as one of the greatest ever All Blacks coaches.