Arts Minister Estelle Morris is to leave Parliament at the next election.
Estelle Morris resigned from the Cabinet in 2002
In a statement, the Birmingham Yardley MP said she had not lost her appetite for politics but wanted to pursue challenges outside the Commons.
The ex-education secretary resigned from the Cabinet in 2002 saying she did not feel up to the job.
But she rejoined the government last year as a more junior minister - a job she says she is willing to continue until the next general election.
Ms Morris said in a statement: "It has been a huge privilege to represent Yardley in Parliament and I owe a debt of gratitude to my constituents and my
party members for giving me that opportunity.
"I am tremendously proud of the achievements of the Labour Government and the contribution I have been able to make in two Departments of State.
"I have not lost my enthusiasm or energy for politics but I want a different focus and a new challenge outside the House of Commons.
"As far as continuing as a minister is concerned, this is of course a matter for the prime minister, but on my part I am more than happy to continue to serve until the next general election."
Later, Ms Morris told BBC2's Newsnight she had concerns about the agenda of "choice" being pursued by Prime Minister Tony Blair and her successor as education secretary, Charles Clarke.
She said historically it had always been the middle classes who benefited from choice because they knew how to play the system.
"Choice is vitally important, but for a left-of-centre government, it has got to be choice with access. That's what marks us out from the Conservatives," she said.
"The people who lose out from choice are the good hard-working families who we are in politics to represent."
Ms Morris admitted she would be glad to speak out publicly about her reservations over Labour education policy once she had left Parliament.
She complained that a culture of off-the-record briefings by some members of the party was making politics too personalised, but denied it was fuelled by a split between the prime minister and Chancellor Gordon Brown.
When Ms Morris resigned from the Cabinet, she was praised for her honesty in saying she felt she was not well suited to running a major department.
As she announced her decision on Tuesday, the former teacher also won praise from Mr Blair and David Blunkett, her former boss at the education department.
Mr Blair said: "Estelle has been a brilliant Labour MP for Birmingham Yardley.
"She has throughout her time in Parliament championed the interests of the city and her constituency with vigour and determination.
"I will be really sorry to see her go but I know, up to the election and beyond, she will continue to work for and support the Labour government."
Mr Blunkett also said he was tremendously sorry to hear the news.
"Estelle has been a fine minister and a superb MP who has made a lasting contribution to raising education standards in this country," he said.