The decision by Benedict, 85, marks the first time in nearly six centuries that a pontiff has chosen to give up the post.
The Holy See press office has said that Benedict will not take part in the conclave of cardinals who will go to Rome to choose his successor sometime in March.
Here's a look at some of the questions surrounding the next six weeks in the life of the Catholic church in light of Benedict leaving the post he's held since 2005.
Does the fact that it's a papal resignation, rather than a death, affect the process of selecting the next pope?
As with so many elements of this story, it's not 100 per cent clear.
"The short answer is we don't know, because a resignation hasn't happened since the medieval times, so we don't know how that dynamic will affect the selection going forward," says Robert Dennis, a PhD candidate and teaching fellow in the history department at Queen's University in Kingston, Ont.
Yiftach Fehige, an associate professor at St. Michael's College at the University of Toronto, says the selection process will be the same.
The only difference, Fehige says in an email, is that the conditions for the vacancy of the Apostolic See are different. That means the current pope "freely resigns" and that the resignation must be "properly manifested, i.e. his fishermen's ring must be melted, he moves out from the papal chamber, etc."
How does the conclave work?
Popes have traditionally been chosen at the conclave, a secret meeting of the College of Cardinals inside the Sistine Chapel. All cardinals younger than 80 can take part, a number reportedly around 117 or 118 at the moment.
The conclave opens at the Vatican with a mass led by the dean of the College of Cardinals, says Dennis. The cardinals then go to the Sistine Chapel to begin their deliberations, which can last for days. (The conclave that chose Benedict was one of the quickest in history, lasting only two days.)
While the deliberations are secret, Dennis says the cardinals will start by discussing the attributes they deem necessary in the next pope.
"They'll begin to talk a little bit about the direction, the vision, what's needed in a pope at the time because contexts change and circumstances change and the needs of the church change."
Eventually, they will begin voting, with each cardinal walking to the front of the chapel to cast his ballot.
"Each ballot is pierced, so it's not counted more than one time and then slowly the names of the candidates begin to emerge," says Dennis.
Balloting continues, with two ballots a day, until one candidate emerges with two-thirds of the vote – a requirement set by Benedict that took the procedure back to a traditional level. The process had been changed by Pope John Paul II to allow only a slight majority of votes to determine the winner.
If the voting continues for three days, Fehige says, there could be a break of up to a day.
Fehige expects a new pope will be chosen within three days.
At the end of the procedure, white smoke emerges from a chimney in St. Peter's Square, indicating a new pope has been chosen.
How is secrecy enforced and maintained?
During the selection process, cardinals can't even call home unless it is a very important matter, says Fehige. They are disconnected from any form of media and "secrecy is also enforced by threat of excommunication," he says.
Very few outsiders are permitted inside.
"Two doctors are allowed into the conclave, as well as priests who are able to hear confessions in various languages and housekeeping staff," the BBC reported, and even they have to swear an oath of perpetual secrecy.
Who are the likely contenders to succeed Benedict?
As with any high-profile vacancy, speculation around who might be Benedict's successor is rampant.
Fehige says it's difficult to say who might be the next pope. "I would have never thought they [would] elect a German. They did."
Too often, he suggests, likely contenders enter history as contenders and not as popes.
Dennis thinks a non-European is a strong possibility, with a number of Latin-American candidates in the mix.
"One name much closer to home is Cardinal Marc Ouelett, who was the cardinal archbishop of Quebec City before leaving within the last year or two for a position in the Vatican. He's quite charismatic, very well read, very well liked, very well known, so he certainly has a chance at election.”
Fehige, however, sees "zero" chance a Canadian will succeed Benedict.
"Canada is not the Vatican's favourite, and none of the Canadian cardinals have what it takes to be pope. They are good in following, but poor in leading."