By Robert Pigott Religious affairs correspondent, BBC News
Britain's most senior Roman Catholic cleric, Cardinal Keith O'Brien, is stepping down as the Archbishop of St Andrew's and Edinburgh.
It follows allegations - which he contests - of inappropriate behaviour towards priests dating from the 1980s.
The Vatican is expected to confirm Pope Benedict has accepted his resignation.
The cardinal is not now expected to take part in the election for a successor to the Pope - leaving Britain unrepresented in the election.
Cardinal O'Brien missed celebrating Sunday Mass in St Mary's Cathedral in Edinburgh, which marked Pope Benedict's eight years in office, ahead of the pontiff stepping down this week.
The resignation of Britain's most senior Roman Catholic cleric in the wake of allegations of improper behaviour creates a crisis for the Church in Scotland, and represents a heavy blow to the wider Church as it battles to shore up its reputation ahead of the papal election or "conclave".
The conclave is already expected to be difficult in the circumstances created by Pope Benedict's unprecedented resignation.
The Vatican is also struggling to deal with reports of internal corruption and mismanagement.
Cardinal O'Brien's resignation is also a personal tragedy for himself. Papal election
He was about to retire after taking part as Britain's only representative in the election next month, a role he took extremely seriously.
He said in a BBC interview on Friday that he found the responsibility of helping to choose a successor to Pope Benedict "almost frightening".
The Observer reported that the three priests and one former priest - from the diocese of St Andrews and Edinburgh - complained to the Pope's representative to Britain, nuncio Antonio Mennini, in the week before 11 February, when Pope Benedict announced his resignation, of what they claimed was the cardinal's inappropriate behaviour towards them in the 1980s.
In resigning his post at the head of the Scottish Catholic Church, Cardinal O'Brien blights the end of an illustrious career only a few weeks before his 75th birthday when he was due to retire.
The development is understood to have been prompted by a concern to protect the Church from further destabilizing speculation during the papal election.
That process is already overshadowed by allegations against a number of the cardinals who are taking part, over their connection with their handling of the Church's sex abuse scandal.
Cardinal O'Brien will be remembered in particular as a forthright defender - occasionally in outspoken and colourful terms - of Catholic teaching on abortion, euthanasia and homosexuality.