Brady announced his resignation Tuesday in a letter to the state party's central committee.
In a phone interview with The Associated Press, Brady says his wife has been battling "very serious" cancer for two years and he wants to focus on her and their four children.
He declined to discuss divisions within the party since its poor showing in last year's elections, but said persistent calls for him to step down had nothing to do with his decision.
Social conservatives have called for Brady's removal, in part because he took a stand in favor of gay marriage earlier this year. They also cite Republicans' poor results in the 2012 election.
Carol Smith Donovan, the current Vice-Chairman will serve as interim Chairman until the Illinois Republican State Central Committee selects a permanent replacement. The State Central Committee elected Brady as Chairman immediately after previous Chairman's Andy McKenna's resignation at Republican Day at the Illinois State Fair in August of 2009.
In his resignation letter, Brady stated that during his tenure as Chairman Republicans in 2010 had their most successful election cycle in decades, electing Senator Mark Kirk to President Obama's former Senate seat, four new GOP members of Congress, two GOP statewide constitutional officers, six new GOP members to the Illinois House and Senate and a Republicans to a number of down ballot offices throughout the state.
The Associated Press contributed to this report.