The Blues won about one-third of their matches under Kirwan, finishing last in the New Zealand conference and 14th overall this year having won just three games.
“I love this club and it's tough to resign,” the former Japan and Italy coach told a media conference in Auckland.
“I've reflected in the past few days and I've taken the decision based on family and results.
“When you're a coach you are here to bring results and I didn't bring those and I always said to fans and players that if I'm not delivering that then it's right that I step aside.
“It's been a fantastic ride and I'm a better coach than I was three years ago.”
Local media reported earlier on Friday that former All Blacks captain Umaga had already signed a three-year contract to take over next season.
Blues Chief Executive Michael Redman, who sat next to Kirwan at the media conference, said the board would meet next week to discuss the coaching position.
Kirwan said Umaga, an assistant coach for the under-20 'Baby Blacks,' could be a good fit for the Blues.
Umaga was with the side at the World Cup in Italy but has returned to New Zealand for the funeral of his cousin Jerry Collins, the former All Black skipper who died in a car crash in France earlier this month.
“I think Tana is an outstanding young man,” Kirwan said.
“He is a guy who I think would be one of the candidates who would be fantastic for here.
“He is from the wider region, he is a good man, but ... it is up to the board to make the right decision going forward.
“What I do know is that the person who comes on board will find a club in better shape than what I did and I think that's important.
“As a colleague of the next person who comes in I am totally available to support (that person) and give any intellectual property... so whoever that might be they can just pick up the phone and I'll be there.” – Reuters
Original source: Kirwan quits as Blues coach