John Alexander revealed on Monday that he was waiting on advice from the British Home Office on whether he had inherited citizenship from his English-born father who migrated as a child in 1911.
Today, the 67-year-old former professional tennis player told reporters the "probability of evidence is that I most likely am" a dual citizen.
"The obligation that I have is that once I do not hold the view that I'm solely Australian, I must resign," Alexander said.
He immediately renounced his New Zealand citizenship.
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Alexander also plans to renounce any British citizenship and run for his Sydney-based seat. No date has yet been set for a by-election.
Before the current citizenship crisis bit into the ranks of Prime Minister Malcolm Turnbull's conservative coalition, they held only 76 seats in the 150-seat House of Representatives where parties need a majority to govern.
Turnbull congratulated Alexander on his resignation and called on lawmakers in the center-left opposition Labor Party who knew they were dual nationals when they nominated for the last election to also resign.
"John has done the right thing, and the honorable thing. He has resigned his seat," Turnbull added.
Australia is rare if not unique in the world in banning dual nationals from sitting in Parliament.
The constitutional quirk had rarely been an issue in its 116-year history, although many dual citizens are suspected to have escaped detection. Only two elected lawmakers had ever been disqualified over foreign citizenship, in 1996 and 1998, before the current Parliament was elected in 2016.
The court rejected the government's argument that ignorance of an inherited nationality should be accepted as an excuse. A sixth senator resigned last week after revealing he had inherited the citizenship of his British-born father.
Most crucial are the fates of lawmakers in the House of Representatives. Senators are replaced usually from members of the same party without elections.
A growing number of lawmakers face questions about whether they were dual citizens or had effectively renounced a second nationality at the time they signed a nomination form to run at the July 2 elections last year.
But he has failed to get the support he needs for the citizenship test from Labor.
Many argue that the dual citizen ban is increasingly inappropriate for a migrant nation where half the population is an immigrant or has an immigrant parent.
But changing the constitution requires all registered voters to cast ballots in a referendum, which rarely succeed.
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