In a release Tuesday night, Klees said he met with PC Leader Tim Hudak to advise him of his decision, but said he will continue to serve until the next general election is called.
Klees said he'll continue to fulfil his critic responsibilities and any others he may be asked to assume as a member of the PC caucus until the next election.
As transportation critic, Klees was the face of PC outrage over the Ornge scandal and Metrolinx spending.
Klees called the decision "very difficult" but added that after almost two decades of public service, the time is right for him to move on to the next chapter of his life.
Hudak issued a statement Tuesday night thanking Klees for his service to the province, the PC party and his constituents.
He noted Klees' work as critic for education, transportation and infrastructure, saying he "fought hard to expose Liberal waste, scandal and mismanagement at Ornge, Metrolinx and with the Presto fare card, demanding that this government put taxpayer interests first."
Klees twice ran for the party leadership, in 2004 when John Tory was elected, and in 2009 when he finished second to Hudak.
His retirement announcement comes amid campaigns for two byelections in the Toronto area riding of Thornhill and in Niagara Falls, where Peter Shurman resigned after clashing with Hudak over housing allowance claims.
There has also been speculation about a possible spring general election should the minority Liberal government fail to get its budget passed.Suggest a correction