BAGHDAD, Iraq (CNN) -- Adm. William Fallon has resigned as chief of U.S. forces in the Middle East and Central Asia after more than a year in the post, citing what he called an inaccurate perception that he is at odds with the Bush administration over Iran.

Adm. William Fallon had been serving as chief of U.S. forces in the Middle East and Central Asia since 2007.

Fallon, the head of U.S. Central Command, was the subject of a recent Esquire magazine profile that portrayed him as resisting pressure for military action against Iran, which the Bush administration accuses of trying to develop nuclear weapons.

In a written statement, he said the article's "disrespect for the president" and "resulting embarrassment" have become a distraction.

"Although I don't believe there have ever been any differences about the objectives of our policy in the Central Command area of responsibility, the simple perception that there is makes it difficult for me to effectively serve America's interests there," Fallon said.

In Washington, Defense Secretary Robert Gates told reporters at the Pentagon that he accepted Fallon's resignation "with reluctance and regret."

But, he added, "I think it's the right decision." Watch why some believe Fallon was forced to resign »

"Admiral Fallon reached this difficult decision entirely on his own. I believe it was the right thing to do, even though I do not believe there are in fact significant differences between his views and administration policy," Gates said.

Don't Miss Esquire: The Man Between War and Peace

In a written statement, President Bush praised Fallon for helping "ensure that America's military forces are ready to meet the threats of an often troubled region of the world.

"He deserves considerable credit for progress that has been made there, especially in Iraq and Afghanistan."

Fallon, a 41-year veteran of the Navy, took over as chief of Central Command in early 2007. Gates said he will be replaced by Lt. Gen. Martin Dempsey, his deputy, who commanded an Army division in Iraq in the early days of the war and led efforts to train the Iraqi military.

The perception that Fallon has opposed a drive toward military action against Iran from within the Bush administration dates to his confirmation hearings in January 2007, when he told the Senate that the United States needed to exhaust all diplomatic options in its disputes with the Islamic republic.

But he also has said that the United States would be able to take steps if Tehran were to attempt to block the Strait of Hormuz, the outlet of the Persian Gulf and a choke point for much of the world's oil.

And he recently told CNN that the United States is looking for a peaceful settlement to disputes "in every case."

"We're trying to encourage dialogue and find resolution," he said. "In fact, that's our message to the Iranians out here, given that everybody is nervous and anxious about their activities, is to come forth and explain what they are doing with all the people in the region."

On Tuesday, Gates said, "We have tried between us to put this misperception behind us over a period of months and, frankly, just have not been successful in doing so."

But Senate Majority Leader Harry Reid said Fallon's resignation showed that independent views "are not welcomed in this administration."

"It is also a sign that the administration is blind to the growing costs and consequences of the Iraq war, which has so damaged America's security interests in the Middle East and beyond," said Reid, D-Nevada. "Democrats will continue to examine these matters very closely in the coming weeks and months."

Meanwhile, Republican presidential candidate Sen. John McCain offered words of praise for Fallon.

"Under Adm. Fallon's leadership at Central Command, the situation in Iraq has improved dramatically," McCain said in a statement. "All Americans should be grateful for Adm. Fallon's service and respect his decision to retire."

Gates' spokesman, Geoff Morrell, said Monday that the secretary and the admiral still had "a good working relationship" and that the Esquire article -- "The Man Between War and Peace" -- had not changed that.

He said Gates had read the article and had no comment on it. E-mail to a friend

CNN's Kyra Phillips and Barbara Starr contributed to this report.

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