Prichard, 33, one of the most pleasant and respected men on the county circuit, told the club that his form had suffered from four years of captaincy and that he wanted to concentrate on his own cricket.
Nasser Hussain takes over officially, though his England duties next year will probably reduce his championship appearances drastically; Prichard, dogged by a leg injury, played only 10 four-day games this summer.
Paul Johnson was the first captain to resign this season, halfway through Nottinghamshire's season, though Kevin Curran's position at Northamptonshire has come under pressure.
Essex's decline could not really be ascribed to Prichard's leadership because four captains were used - Prichard (two won, six lost), Hussain, Stuart Law and Paul Grayson - though Prichard's batting form was disappointing.
The most notable achievement for Prichard was probably taking Essex to their NatWest Trophy success last year, the county's first title without Graham Gooch in the side, and he added the Benson and Hedges Cup this summer, his 92 in the final against Leicestershire being the highlight of the county's season.
Prichard missed several weeks of the season because of shin splints and in 10 championship matches managed only 237 runs, for an average of 13.16.
Sussex captain Chris Adams is negotiating cricket's first £1 million player contract as he seeks a deal which will allow him to see out his career with the county.
Adams, aged 28, is already believed to be the highest-paid Englishman on the county circuit after signing a three-year contract worth an estimated £100,000 per year when he joined Sussex from Derbyshire last winter.
Now he is negotiating an extended contract which would keep him on the Sussex payroll for the next 10 years. Adams, who led Sussex to seventh in the championship, said: ``I have thoroughly enjoyed this year and I want to commit myself to Sussex.''