Fyfe has been a member of the club's leadership group since 2015, stepping up as skipper for the 2017 season. A star Docker, Fyfe has played 209 games for the club since being drafted in 2009, winning a Brownlow Medal in 2019 and earning three All Australian blazers.
The 31-year-old said that while the decision was "tough", he thought the transition to a new captain would be an exciting time for the club.
"The decision was tough. It has been something I've known for the last three or four weeks," Fyfe said.
"Last year was a challenging year for me individually, but a great year for the Club and it started to pave the way for a transition.
Nat Fyfe informed teammates today that he will stand aside as captain and from any formal leadership duties.
After six years in the role, Fyfe is our second-longest serving captain.
Thanks, Nat 💜 #foreverfreo
— Fremantle Dockers (@freodockers) February 7, 2023
"Intuitively, I knew that it was an exciting opportunity for the Club for me to step aside and let someone else come through.
"It took a while for the emotions and my mind to line up with my intuition, it feels like I was letting go of a dream in some ways, but once I connected with that feeling, it opens up the possibility for so much more.
"I'm optimistic about what this transition can do for the Club."
Fyfe managed just seven games in 2022 after struggling with injury, with Alex Pearce stepping in to replace him as skipper throughout.
The Dockers are set to finalise their 2023 leadership group, and captain, this month.