Bratton said he thinks his replacement should be someone from within the department.
The police commission will narrow the list of applicants down to six. The mayor will pick from the final three.
Bratton and L.A. Mayor Antonio Villaraigosa will be in Hollywood on Thursday to announce a reduction in crime due to a 40-officer foot patrol.
Bratton has received a lot of praise for lowering L.A.'s crime rate to levels not seen since the 1950s, but he also wants to be remembered for improving race relations in Los Angeles.
Bratton will step down at the end of October to work for a global security firm Altegrity in Virginia.
He joined the department in 2002 at a time when the LAPD was struggling to recover from scandal and racial tension stemming from the Rodney King beating and the '92 riots.
The LAPD remained under federal oversight because of the Rampart Scandal until just a few weeks ago.
One of Bratton's goals was to make the police force more diverse and reflect the makeup of L.A. The LAPD is now 42 percent Latino, 37 percent white, 12 percent black and 7 percent Asian.
"The legacy I'd like to be remembered for is ... the improved race relations in the city as reflected in you, looking out in this room, the way you look, the minority representation, the ethnic representation," Bratton said. "You look like Los Angeles. You are Los Angeles," Bratton said.
The ACLU says Bratton has made progress, but racial profiling still exists, according to a report by the ACLU.
"A report that showed black and Latino residents of this city are stopped, frisked and arrested far more often than whites," said ACLU executive director Ramona Ripston in a statement.
"That's a very troubling trend, and it demonstrates that even under Chief Bratton, the LAPD has not yet met all the goals and intent of the consent decree."
The chief has reshaped the LAPD and bolstered the reputation of the agency. He added computer tracking and predicting where crime was going to be the highest in Los Angeles.
"Because of him Los Angeles is the safest it's been in more than a half a century. He's leaving Los Angeles a stronger city, a more united city, a safer city," Villaraigosa said.
Bratton put his Los Feliz home up for sale last month, but had denied rumors at the time that he was leaving Los Angeles. There had been reports he was reconsidering a job with the Scotland Yard.
"When you love what you do, when you love the people you get to do it with, when you love the way you do it, there is never a good time to leave, but there is a right time. And for me, personally and professionally, at this time it is the right time," Bratton said during Wednesday's news conference.
LAPD Chief Bratton's letter to department employees:
"Earlier today, Wednesday, August 5th, I met with Mayor Antonio Villaraigosa to inform him of my intention to resign my position as Chief of our great Department effective October 31st, so that I may pursue new professionalization of policing opportunities in the private sector. There is never a good time to leave a job and a Department that you love and enjoy, but there is always a right time. That time has now come for me professionally and personally to seek new career challenges.
"Since my appointment as Chief of this extraordinary Department in October 2002, by then Mayor James Hahn, we have travelled together on an exciting and successful journey - through good times and bad - meeting crises, challenge and opportunity with consistent optimism, confidence and resolve.
"You and I committed to five overarching goals in 2002, and as of today, we can all take justifiable pride and satisfaction in knowing that we have in large measure met and continued to expand their impact in our ultimate purpose for being: to protect and to serve all the residents of this great City. We committed to reduce crime, fear, and disorder, and we have done that. We committed to keeping the City safer from terrorism and we have done that while establishing national best practices and initiatives. We committed to full implementation of the Federal Consent Decree, and while it took longer than originally anticipated, we have done that. We campaigned to grow the Department by 1,000 officers and with the focused leadership of Mayor Villaraigosa and the support of the City Council and voters we are doing that. We also committed to Bias-Free Policing, to ensure that all the residents and visitors to our City of Angels would be the benefactors of constitutional, compassionate, consistent policing in every neighborhood. The recent Harvard Study and Los Angeles Times poll have conclusively shown that a significant majority of all Angelinos feel that you are succeeding. It will not be easy to leave because, while much has been done, there is still much more that can be done. But having met the personal and professional challenges that I set for myself, I feel that this is an appropriate time for new leadership to move the Department forward and meet the challenges that lie ahead.
"Thank you for the honor, the privilege and the enjoyment of working with you, and for the opportunity to tell your story during these past seven years. I hope that each of you in some way, no matter what your position, felt that you were part of what I believe will be a very special time in the history of the Department ? our Department ? a Department that is without question second to none. It has truly been an honor and a privilege to be your chief."