The 61-year-old took charge of Fiji in 2020 after coaching French clubs Clermont and Montpellier.
He also took Scotland to the quarter-finals of the 2015 World Cup.
Tevita Tuiloa, the interim chief executive of the Fiji Rugby Federation, declined to comment on Cotter's future replacement - 'it could be a Fijian or a foreigner' - but plans to appoint a coach by the end of February .
"Fiji Rugby has been blessed to have Vern Cotter on board but the decision (to step down) came directly from him for personal reasons," Tuiloa told a news conference in Fiji's capital Suva. .
"Time is against us to find a coach who can take the Flying Fijians to the next level (to the World Cup), but we are confident we have the players," he said.
Fiji have been drawn with Australia and Wales, two nations who also changed coach recently, as well as Georgia and Portugal in Pool C of the next Rugby World Cup, which will take place in France (8 September-28 October).
Fiji's best performance in the World Cup came in the 2007 edition, already contested in France, where they reached the quarter-finals after a group victory over Wales (38-34), before lose to South Africa, future winner (37-20).
© 2023 AFP