Akira Amari's surprise resignation comes a week after the veteran politician was hit by claims in a weekly magazine that he and his staff had improperly accepted a 12 million yen (USD 101,000) bribe from a construction firm.
Today, Amari - the point man on a Pacific-wide free trade pact and a key face in Abe's bid to overcome Japan's decades-long economic malaise - apologised for the scandal but rejected claims he pocketed the money.
But "considering my responsibility as a member of parliament who has to oversee my secretaries, my duty as a cabinet member and pride as a politician, I will resign my post as of today".
Amari admitted envelopes filled with cash had arrived at his office, but said he ordered his secretary to deal with some of the money according to political donation rules.
Amari did not say how much was received in total.
The Shukan Bunshun magazine said last week the construction company had sought Amari's help in settling problems with a quasi-public housing agency over damage caused by a road project.
It cited a company official as saying the firm had wined and dined the minister's staff and had given them gifts and envelopes stuffed with cash, including on two occasions handing a total of one million yen to Amari himself.
Nobuteru Ishishara - a one-time secretary general of the ruling Liberal Democratic Party and son of a former Tokyo governor - was named Amari's successor.
The resignation comes with Japan looking to kickstart its moribund economy, with Amari saying: "The economy is now on the verge of getting out of deflation after 15 years."
"We need to enact a package of bills as quickly as we can to bring about a strong economy, and we need to avoid any obstacles to that - I will not be an exception."
