Victoria's Public Transport and Arts minister, Lynne Kosky, has resigned from State Parliament.

Ms Kosky has cited health problems within her family as the reason for her decision to step down from politics.

At an emotional media conference this morning, Ms Kosky said she agonised over the decision, but realised she had to put her family's health before politics.

"I've thought long and hard about my capacity to provide the support to my family that they deserve, particularly at the moment, along with the close attention that my job demands, and I've come to the conclusion that it's not possible for me to do both," Ms Kosky said this morning.

"I do leave with some sadness, but no regrets.

"This is a decision I've not taken lightly but it's the right one for my family and for me."

The Premier, John Brumby, says Lynne Kosky has made an extraordinary contribution as a minister, but she has to put her family first.

"It's the right decision for her and her family to resign the Ministry and to retire from Parliament," Mr Brumby said.

"The view that I put to her was that in this business, you must always put your family first.

"In a sense, it's no good looking back in five or 10 years time and saying, 'I should have done that at the time, and I didn't.'

"You only get one chance to get it right."

Mr Brumby will announce his new cabinet on Wednesday.

Tributes

The Opposition's public transport spokesman, Terry Mulder, says he respects Ms Kosky's decision.

"We wish Lynne well, we understand that she's made her decision based on family reasons," Mr Mulder said.

"Family must come first.

"We respect the decision that she's made.

"I've had I believe a good working relationship with Lynne Kosky, as much as you can from Opposition."

Ms Kosky was first elected to the Victorian parliament in 1996 in the seat of Altona, in Melbourne's west.

A by-election will be held to elect a new Altona MP, before the Victorian state election later in the year.

Mr Brumby says he would rather not fight two campaigns in one year.

"But obviously we'll contest that," he said.

"We'll aim to win that by-election and we'll run the best possible candidate."

Ms Kosky's state electorate overlaps with the federate electorate held by the Deputy Prime Minister, Julia Gillard.

Ms Gillard has paid tribute to Ms Kosky.

"She's made a significant contribution to Victorian politics, to the life of this state and of course to the people of Altona, the electorate that she represents," Ms Gillard said.

"So from my point of view, she will be missed."

Public transport woes

Ms Kosky took over the public transport portfolio after Labor's 2006 state election win.

Her term as Transport Minister has been overshadowed by widespread faults on the public transport system, including massive delays and cancellations on the metropolitan rail network and the troubled introduction of the Myki ticketing system.

Ms Kosky says her portfolio challenges did not influence her decision to leave politics.

"I have hopefully made a significant different, a significant improvement, to public transport in this state," she said.