In his last public address as Emperor from the Matsu-no-Ma state room of the Imperial Palace, Akihito thanked the Japanese people for their support as his 30-year reign came to an end and said he hoped his successor's time on the throne would be "stable and fruitful".
Akihito's eldest son, Crown Prince Naruhito, will ascend the throne on Wednesday and then a new era called "Reiwa" -- meaning order and harmony -- will begin in Japan's unique calendar. Naruhito will become Japan's 126th Emperor.
"Since ascending the throne 30 years ago, I have performed my duties as the Emperor with a deep sense of trust and respect for the people and I consider myself most fortunate to have been able to do so," 85-year-old Akihito said in a speech broadcast live on TV.
"I sincerely wish, together with the Empress (Michiko), that the Reiwa era, which begins tomorrow (Wednesday), will be a stable and fruitful one and I pray, with all my heart, for peace and happiness for all the people in Japan and around the world," the 125th emperor said.
Akihito was given permission to abdicate after saying he felt unable to fulfil his role because of his declining health.
The main "Ceremony of the Abdication" took place in a state room of the Imperial Palace, which was attended by around 300 people, including Prime Minister Shinzo Abe, Crown Prince Naruhito and Crown Princess Masako.
Later, Abe thanked Akihito and Empress Michiko for their decades of service, noting that the couple had "stood by the people, giving them courage and hope" in the aftermath of several natural disasters to have struck Japan during his reign.
Akihito's Heisei (achieving peace) reign ended with the symbolic return of two of the "three sacred treasures" (a sword and a jewel), which were placed on stands by palace officials along with the state and privy seals.
US President Donald Trump and Russian President Vladimir Putin were among world leaders to send tributes. Trump, who will be the first world leader to meet the new Emperor during a visit to Tokyo in late May, voiced his "heartfelt appreciation" to the imperial couple, while Putin thanked the Emperor for promoting Japan's ties with Russia.
South Korean President Moon Jae-in thanked Akihito for his contribution to peace and bilateral ties.
Female members of the imperial family will not be allowed to attend the Wednesday's ceremony, a tradition the government decided to retain despite criticism.
The 59-year-old Naruhito, who spent two years at Oxford and wrote his thesis on the history of transport on the Thames, and Crown Princess Masako, a Harvard-educated former career diplomat, will greet the public for the first time as emperor and empress on Saturday.
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