The announcement was made on Monday afternoon on his Facebook page.

"The last three months has been a particularly trying time in my life. Starting with a long hospital stay, unbearable stresses on my family and now [attacks] nearly every day with baseless accusations, has led to my mental health significantly suffering," Cr Shields said.

ALSO MAKING NEWS:

"I am told by my doctors I will need a long period to recover. In their mind, I cannot recover from a significant mental health episode while ever I am in a high stress role."

On Monday, Cr Shields said it was "impossible for anyone to carry out the duties as mayor" because of the restrictions that were placed upon his return.

Under the council-imposed restrictions, the mayor was unable to make phone calls without someone in the room. He was unable to be in the council building without a senior staff member present and all of his correspondence had to be read before it was able to be sent.

Cr Shields said the accusations against him ranged from the "serious to the laughable".

"The last few days I have been accused of so many things I have lost count. They have said that I have caused a death at council, to the laughable, where I was supposedly going to cut off water to [Taronga] Western Plains Zoo," he said.

The mayor has also thanked the Dubbo community for its support.

"The last 22 years as a councillor has been a roller-coaster ride to say the least. Starting as Dubbo's youngest ever elected, to being the first mayor of the merged Dubbo Regional Council, I couldn't have been there without the continued support of the public," he said.

Cr Shields said he had never had as much community support as what he had experienced in the last 12 months.

It's believed Cr Shields will not be running in the upcoming council elections.

His resignation will be effective as of noon Thursday. Former council director Murray Wood will be stepping into the role of interim general manager from Monday

The decision was made by the Dubbo councillors at last week's council meeting.

Dean Frost has been temporarily in the role since Michael McMahon retired earlier in the year.

Cr Shields was contacted for comment by the Daily Liberal on Monday morning but has not responded. Deputy mayor Stephen Lawrence was also contacted for comment.

Seven councillors have been calling for the mayor to resign, in addition to Dubbo State MP Dugald Saunders.

More to come.

Do you have something to say? We welcome your letters which may run in print and online.