The first Muslim woman to serve in the Cabinet posted a message on Twitter announcing she 'can no longer support Govt policy on #Gaza'.
The loss of the former Tory party chairman will put pressure on David Cameron, who has refused to say whether Israel's actions in Gaza are 'criminal'.
In a statement posted on her Twitter feed, she said: 'With deep regret I have this morning written to the Prime Minister & tendered my resignation. I can no longer support Govt policy on Gaza.'
Baroness Warsi was the senior minister of state at the Foreign Office and faith minister at the Department for Communities and Local Government.
There were no further details given about the reason for her decision to resign, or the timing.
Just last night she attended a ceremony in Westminster Abbey to mark the centenary of the outbreak of World War One.
However, it came as displaced Gazans began returning to their homes from UN shelters after the latest ceasefire between Israel and Hamas took effect.
The 72-hour truce, which started at 8am local time (6am BST), was agreed by both sides in the month-long conflict which has seen hundreds killed.
Mr Cameron has faced criticism, including from Labour leader Ed Miliband, for failing to take a tough enough line with Tel Aviv over the crisis.
Yesterday the Prime Minister refused to say whether he believes Israel's actions in Gaza are 'criminal'.
He said the UN was 'right' to condemn an airstrike near a school in Rafah that left 10 people dead.
But he stopped short of endorsing secretary general Ban Ki-Moon's description of the attack as a 'moral outrage and a criminal act'.
(leaders of the Liberal and NDP,) silence implies consent.
We need more Baroness Warsis in Canada. Elizabeth May is the only leader of a Federal political party to publicly support the Palestinians.
At least we know where that scuzball Harper stands. He makes no bones about his fawning admiration for Israel's genocidal policies.