The job of picking Pope Benedict's successor now lies in the hands of a select group of cardinals who will be summoned to Rome in the coming days.
On the death or abdication of a pope, his successor is elected by cardinals meeting in conclave.
Since 1271, when, following a deadlock, the cardinals were locked up and given only bread and water as a means of inducing them to draw the proceedings to a close, they have been required to remain in total isolation during the deliberations, with only a doctor and a cook to assist them. Four ballots are held each day, two in the morning and two in the evening, until a result is obtained.
The ballot papers are burnt after each count. If a new pope has been elected, the papers are burned with a substance that gives off white smoke, to signal the news to the waiting crowds outside.
If no candidate has succeeded in gaining the necessary two thirds majority, the smoke given off is black.
Pope Benedict XVI (16th) is to resign at the end of this month after nearly eight years as the head of the Catholic Church, saying he is too old to continue at the age of 85.
BBC News reports the unexpected development - the first papal resignation in nearly 600 years - surprised governments, Vatican-watchers and even his closest aides.
Story by: Vijay Narayan