Japan's Chief Cabinet Secretary Yoshihide Suga said the country will resume commercial whaling in July next year.
The IWC, established in 1946 to conserve and manage the world's whale and cetacean population, introduced a moratorium on commercial whaling in 1986.
Commercial whaling was banned by the IWC in 1986 after some species were driven nearly to extinction.
Japan now uses a scientific exemption to kill hundreds of whales a year, but critics have condemned it as a cover for commercial whaling, noting that meat from the annual hunt often ends up being sold.
Worldwide conservation group Sea Shepherd has long protested against Japan's whaling programme, often trailing its whaling ships in Antarctic waters.
The Japanese government, which began scientific whaling in 1987, a year after the worldwide whaling moratorium was introduced, has long maintained that most whale species are not endangered - six of the world's 13 "great whale species" are classified as endangered, according to the World Wildlife Fund.
The decision to withdraw from the IWC followed its latest rejection of Japan's bid to resume commercial whaling at a September meeting, which Suga said showed it was impossible to bridge the gap between whaling advocates and anti-whaling members.
"With this move the Japanese government is officially turning its back on worldwide cooperation around conservation measures, and one of the greatest conservation agreements ever made - the ban on commercial whaling", said Astrid Fuchs of Whale and Dolphin Conservation (WDC). Third, it will "cease the take of whales in the Antarctic Ocean/the Southern Hemisphere".
"As a result of modern fleet technology, overfishing in both Japanese coastal waters and high seas areas has led to the depletion of many whale species", Greenpeace International said.
Japan has hunted whales for centuries, and the meat was a key source of protein in the immediate post-World War II years when the country was desperately poor.
Some lawmakers in the Liberal Democratic Party, headed by Prime Minister Shinzo Abe, stress the need to preserve local whaling traditions, but it is unclear whether demand will increase even if commercial whaling resumes. Whaling communities and those who work in the industry have welcomed the resumption of commercial hunts, but others have expressed concern about whales and the expected damage to Japan's reputation.
"The declaration today is out of step with the worldwide community, let alone the protection needed to safeguard the future of our oceans and these majestic creatures", said Sam Annesley, executive director at Greenpeace Japan.
It makes no secret of the fact that meat from the expeditions ends up on dinner tables, and argues that stocks of certain whales are now sufficient to allow commercial hunts to resume.
Much of the meat ends up on store shelves, even though most Japanese no longer eat it. Whale consumption accounted for 0.1 percent of all Japanese meat consumption, according to the Asahi newspaper.
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