Sarah Palin announced Friday she is stepping down as governor of Alaska at the end of the month, fuelling speculation she could make a run for the Republican presidential nomination in 2012.

Alaska Gov. Sarah Palin waves at the conclusion of a Republican campaign stop in Colorado during last fall's U.S. presidential election. (David Zalubowski/Associated Press)Surrounded by her family outside her home in Wasilla, the 2008 Republican vice-presidential candidate said it "hurts" to make the choice, but Alaskans will be "well-served" by her decision.

During her hastily-arranged appearance, Palin offered no clear explanation as to why she was leaving office and did not answer any questions from reporters after her brief statement.

"My choice is to take a stand and effect change, not just hit our head against the wall and watch valuable state time and money, millions of your dollars, go down the drain in this new political environment," she said.

"Rather, we know we can effect positive change outside government at this moment in time, on another scale, and actually make a difference for our priorities."

Palin, whose term was to end in 2010, said she will transfer authority to Sean Parnell, the state's lieutenant-governor, on July 26.

Parodies and public battles

The governor had previously hinted in interviews she was considering not running for re-election in Alaska, but gave little indication an announcement on her future was coming so swiftly.

Her announcement follows a similar move from Minnesota Gov. Tim Pawlenty, who is also among the favourites for the Republican ticket in 2012 and said last month he would not seek re-election as governor.

Palin’s surprise selection as John McCain's Republican running mate rallied the party’s conservative base, but also appeared to alienate more moderate members and independent voters, who flocked to Democrat Barack Obama.

Obama scored a decisive victory in the November election, which also saw the Republicans decimated in Congress and Democrats awarded with hefty majorities in both the Senate and House of Representatives.

After the election, Palin hit out at what she viewed as scathing and biased coverage of her and her family in the media. She was also an object of mockery in Tina Fey's highly popular parody of her on Saturday Night Live.

More recently, Palin became embroiled in a public war of words with late-night talk show host David Letterman, who made a joke involving one of her daughters and New York Yankees baseball player Alex Rodriguez.

Letterman later apologized for the joke.