Abraham "intends to step down from his role by the end of 2017 in order to develop personal plans to launch a media enterprise in 2018", the broadcaster said.
He leaves following six years of rising revenues, but with the TV ad market wobbling because of Brexit, and with the state-owned broadcaster still facing uncertainty about whether the Government could privatise Channel 4.
There has been speculation for at least six months that he was planning to leave and he played little part in Channel 4’s upfronts presentation to advertisers in November 2016 as Jay Hunt, the chief creative officer, and Jonathan Allan, sales director, took centre stage.
Senior figures at Channel 4, including Abraham, forcefully denied he had any plans to leave when Campaign asked the broadcaster in October 2016 about reports that the board was actively planning for Abraham’s departure.
A Channel 4 spokesperson told Campaign at the time: "Talent planning is a standard part of good corporate governance, but David Abraham has no plans to leave Channel 4."
During his reign, Abraham helped to build Channel 4’s sales house, which sells air-time on behalf of UKTV and BT Sport, and ad sales rose to a record £1.18bn, according to its most recent financial accounts for 2015.
He departs Channel 4 with a new, estimated ten-year ad sales deal in place with UKTV, its most important commercial partner, which is believed to be worth as much as £2bn over the period.
Channel 4 also renewed its ad sales deal with BT Sport last year after a lengthy negotiation, guaranteeing further income over the medium term.
However, critics such as John Billett, the chairman of ID Comms, criticised Channel 4 for lack of transparency over its programme finance deals with media-buying groups, notably Group M, which involved the broadcaster giving air-time in return for investment in programming.
Channel 4 and Group M maintained there was "absolutely no conflict of interest".
Abraham and Jay Hunt, the director of television, can claim credit for creative revival at Channel 4 with new shows such as Gogglebox and Hunted.
His biggest bet was to poach the rights to Great British Bake-Off from the BBC in an estimated £75m deal but Abraham is likely to have left before Channel 4 can prove whether it was a smart decision.
Hunt is likely to be the leading internal candidate to succeed Abraham, who will stay until a successor is appointed. Channel 4 declined to comment.
Charles Gurassa, chair of Channel 4, said: "David Abraham has been an outstanding chief executive of Channel 4 over the last seven years.
"Under his leadership the channel has delivered record revenues, record programme investment, award winning creative renewal and industry leading digital innovation.
"He leaves the organisation in excellent creative and financial health and with a strong and highly experienced team in place."
Abraham said: "I had three priorities when I joined Channel 4 in 2010: to build an independently sustainable business while still delivering strongly to our public remit; to assemble a team capable of delivering creative renewal post Big Brother; and to become world leaders in digital and data innovation.
"After several successive years of positive momentum and with revenues now of around £1bn, investment in content of £700m and sustained creative performance, I have decided that 2017 is the right year for me to hand over this important public job to my successor."
Abraham, who has strongly opposed privatisation, signed off with a message for government, declaring: "Channel 4 matters and I am confident that our stakeholders recognise the unique and significant contribution it will make to the future of UK broadcasting and to the creative industries more broadly."
He previously was chief executive of UKTV and ran ad agency St Luke's.