Ricciardo, who has driven with Red Bull since 2014, admits it will not be easy to walk away from the team with whom he has recorded seven victories.
"It was probably one of the most difficult decisions to take in my career so far," he said.
"But I thought that it was time for me to take on a fresh and new challenge."
Ricciardo, sitting in fifth position on the drivers championship standings with two wins this year, had already been linked to Renault prior to signing with the French manufacturer.
"I realise that there is a lot ahead in order to allow Renault to reach their target of competing at the highest level but I have been impressed by their progression in only two years," Ricciardo said.
"We fully respect Daniel's decision to leave Aston Martin Red Bull Racing and we wish him all the best in his future," Red Bull team principal Christian Horner said.
"We would like to thank him for his dedication and the role he has played since joining the Team in 2014, the highlights of course being the seven wins and the 29 podiums he has achieved so far with us.
"We will now continue to evaluate the numerous options available to us before deciding on which driver partners Max Verstappen for the 2019 season."
The surprise announcement will ripple through the driver market, with other teams set to shake up their line-ups as a consequence.
Ricciardo had been out of contract at the end of the year and was assessing his options, but any hope of joining champion Mercedes disappeared when it retained titleholder Lewis Hamilton and Finland's Valtteri Bottas.
Glamour team Ferrari has shown no obvious interest either, with Sauber's Monegasque rookie Charles Leclerc tipped to replace Kimi Raikkonen if the 38-year-old 2007 world champion is not kept on.
Ricciardo, a fan favourite with his permanent smile and thrilling overtakes, had indicated before the August break that he was set to stay at third-placed Red Bull and was just 'fine-tuning' details.
Former champion Renault was always the best of the rest and had a vacancy, with Spaniard Carlos Sainz there on loan from Red Bull alongside Germany's Nico Hulkenberg.
Sainz could return to the Red Bull fold alongside his former Toro Rosso teammate Verstappen but has also been linked to McLaren, where he could form an all-Spanish line-up with Fernando Alonso.
McLaren has not won a race since 2012 and is going through a re-building phase.