"I feel now is the right time for Western Australian cricket to have a fresh voice and a new leader to take the Warriors and Scorchers forward," North was quoted by the Sydney Morning Herald.
North's decision comes following the reported indiscipline shown by Shaun and Mitchell Marsh, who chose to party on the occasion of Mitch's 21st birthday during the CL T20 tournament in South Africa.
"All I'll say is there are players who played today, and the players who didn't play today who let the team down in preparation last week. That's all I'll say," North said after the last match of the tournament.
"Last week against Delhi, there were players in our side who didn't reach the standards in preparation that we required from them," he added.
On the other hand, the Western Australia selection panel left out Shaun Marsh for WA's Sheffield Shield trip to Melbourne later this week for his off-field behaviour.
In a WACA statement, North revealed that there are players who were potentially more deserving than him to take his place.
"There have been times where I have felt the balance of the Scorchers has been compromised by my position in the team and some very good players have had to miss out, such as Paul Collingwood at Champions League," North said.
"If I don't go to Melbourne later this week and make runs, you could argue that I don't deserve to be playing," North said.
North has captained in 40 Shield fixtures with 15 wins, 10 losses and 15 draws to his name and 14 wins and 19 losses in one-day competition.