| L. K. Advani, in car, comes out of the residence of former Indian Prime Minister and senior BJP leader Atal Bihari Vajpayee after a meeting in New Delhi |
The controversy over Mr. Advani's remarks was triggered during his six-day visit to Pakistan, where he described the nation's founder, Mohammed Ali Jinnah, as a secular man who wanted Hindu and Muslims to live in friendship.
The remark led to an uproar among Hindu hard-line groups that are closely allied to Mr. Advani's Bharatiya Janata Party.
Hindu hard-liners regard Pakistan's founder as a Muslim fundamentalist. They hold him primarily responsible for the division of the Indian subcontinent into India and Pakistan because he pushed for the creation of mostly Muslim Pakistan when the British were leaving the region in 1947.
But on his return from Islamabad, Mr. Advani said he stood by his remarks, and resigned as head of the BJP when the controversy refused to die down. He said his visit had helped to reinforce peace initiatives between India and Pakistan.
Many of his party's members have come out in support of Mr. Advani, and are asking him to continue to lead the party.
One such leader is Sahib Singh Verma. He says Mr. Advani merely quoted Mr. Jinnah to say that Pakistan's founder had favored a secular state to an Islamic Pakistan.
But Hindu hard-line groups such as the World Hindu Council have welcomed his decision to step down saying his remarks praising Mr. Jinnah are unacceptable.
Many Hindu activists even came out into the streets in western India, beating drums and setting off firecrackers as the news of the resignation spread.
Mr. Advani's decision to step down comes at a time when the Bharatiya Janata Party is in turmoil following its defeat in national elections one year ago.
Many political analysts partly blamed that defeat on the party's image as a hard-line Hindu party opposed to Muslims.
Mr. Advani himself is regarded as one of the most hawkish members of the party, and is accused of instigating a mob to destroy a mosque in Northern India in 1992.
Independent political analyst Mahesh Rangarajan says the remarks by Mr. Advani in Pakistan could be a deliberate effort to recast himself and the party in a more moderate light.
"Anyone who is the preeminent leader of the BJP has to live down the image which the party has earned for itself. He is trying to soften his image," he said.
Mr. Advani had been widely expected to take over the BJP's political leadership as the aging former Prime Minister Atal Behari Vajpayee moved to the sidelines.