In his last Angelus in St Peter’s Square, he told thousands of cheering pilgrims his decision did not mean he was abandoning the Church.
Pope Benedict, 85, announced his resignation last week, saying ill-health meant he could not continue.
Cardinals are gathering to choose the next pope amid fears Church sex abuse scandals may overshadow the process.
Speaking from his balcony overlooking St Peter’s Square, Pope Benedict used several different languages to salute the Catholics who had come to bid him farewell at the end of his eight-year reign.
He said he was following God’s wishes in deciding to abdicate.
“The Lord is calling me to climb the mountain – prayer is not an isolation from the world,” he said.
“I am not abandoning the Church and shall continue to serve it in a manner more adapted to my age and strength,” through prayer and meditation, he added.
Pope Benedict will hold his last public appearance as pope in the square on Wednesday before he retires to a life of seclusion and prayer.
In total 117 Cardinals under the age of 80 from around the world have been called to the conclave to choose his successor.
The whiff of scandal involving a Scottish and a US Cardinal is overshadowing the transition to a new papacy, the BBC‘s David Willey in Rome says.
Some Catholics are calling on Cardinal Keith O’Brien from Scotland and Cardinal Mahony from Los Angeles to refrain from voting in next month’s election.
Cardinal Mahony was stripped of his duties as Archbishop of Los Angeles last month over allegations he protected priests accused of sexual abuse.
Cardinal O’Brien has denied allegations of “inappropriate behaviour” going back 30 years.
The Vatican has denounced attempts to condition the freedom of all cardinal electors to choose who they want to lead the Church in future.
On Saturday a statement criticised the media for reporting “misinformation” about alleged intrigue and corruption in the church.