Leno officially made the announcement during Monday night's Tonight Show.
"In 2009, I'll be 59 years-old and will have had this dream job for 17 years," Leno said in a statement issued by NBC. "When I signed my new contract, I felt that the timing was right to plan for my successor and there is no one more qualified than Conan. Plus, I promised Mavis I would take her out for dinner before I turned 60."
O'Brien, who succeeded David Letterman as the host of NBC's Late Night 11 years ago, has signed a new contract with the network in a long-term deal that will keep him at his post for the next five years and then has him immediately transitioning as host of The Tonight Show.
Leno succeeded Johnny Carson as host of the venerable late night talk show in 1992. He and Letterman famously competed for the slot, and after he lost, Letterman exited NBC to be come the host of the CBS Late Show with David Letterman.