He does not believe that he is the right person to lead the party to the next election, and has offered his successor his full support. The NZLP will now formally begin the process of electing a new leader under the party's revised rules, which were changed at the last Labour Party conference.
Neither Mr Shearer nor Labour's senior whip Chris Hipkins would answer questions from the media. No-one will say whether Mr Shearer fell on his sword, or was pushed.
We have however just heard on 3News that Phil Goff and Shane Jones were seen earlier today leaving Mr Shearer's office, with Goff patting Jones on the back. It would seem that our Whodunnit? rating for Mr Jones of 8.5/10, the highest score we awarded may have been right on the money.
And can you spot a noticeable absentee while David Shearer was announcing his resignation this afternoon?
Where was Grant Robertson? Surely, you'd expect the deputy leader to be there to support the outgoing leader at a time like this. Has Mr Robertson's campaign for the leadership begun already?
Meanwhile, here's the Herald's take on it:
David Shearer will stand down as Labour leader, saying he no longer believed he had the full confidence of his caucus.
He said Labour had not had the lift in the polls needed under his leadership and his soundings of caucus had indicated he should step aside to allow a fresh start.
"My sense is I no longer have the full confidence of many of my caucus colleagues,"
Mr Shearer called the press conference at short notice this afternoon following a Labour caucus meeting this morning.
Mr Shearer told the press conference it was better he step down so there could be a "clean change to a new leader who can take Labour through to victory in 2014''.
He said he looked forward to continuing as a member of the Labour Party and as the MP for Mt Albert.
"Whoever becomes the new leader can rely on my full support,'' he said.
There was no explanation at Mr Shearer's hastily called press conference about why he stood down and no word on who may take over.
And Stuff reports thus:
Labour leader David Shearer has stepped aside, saying he didn't think he had support of his full caucus.
Shearer said his resignation would be effective once a new leader was elected.
Whip Chris Hipkins said a replacement would be decided in three to four weeks. He said he had informed the party president Moira Coatsworth and secretary Tim Barnett this morning.
Heading into the House with list MP Jacinda Ardern, Wellington Central MP Grant Robertson said he was the acting leader but he could not say who was acting deputy.
Shearer's seat was empty when the House sat at 2pm.
Asked about the Government's programme for next week, Leader of the House Gerry Brownlee joked there was plenty to keep Labour occupied next week - and in coming weeks.
Shearer told reporters it had been a privilege to lead the party for the past 20 months.
''But we do need to do more. So the time has come for me to hand over to a new leader who can take Labour through to 2014."
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Stand by for a major political announcement at 1.30pm. David Shearer is holding a media conference after an urgent, hastily-convened Labour caucus meeting, and is expected to announce that he will stand down as Labour Party leader.
And Duncan Garner didn't break this story!
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