He said he will relinquish his title as executive editor of Muscle & Fitness and Flex magazines and will forego any compensation.
"I don't want to be paid," Schwarzenegger said in a telephone interview with the AP.
"The decision is to discontinue the relationship we have now," he said. "I will continue promoting body building and fighting obesity..."
The governor was forced to defend his contract with the magazines after a securities disclosure filed this week showed he would be paid at least $1 million a year for five years to act as a consultant.
Last year, Schwarzenegger vetoed a bill that would have regulated the use of performance-enhancing substances in high school sports. That led some lawmakers to accuse the governor of having a conflict of interest: acting on legislation that could hurt business in the nutritional supplements industry while at the same taking millions from magazines that rely on the same industry for most of their profits.
The bill's sponsor, state Sen. Jackie Speier, D-Hillsborough, on Thursday called on Schwarzenegger to sever his ties with the magazine.
On Friday, Schwarzenegger said he wanted to leave no doubt that "the people have my full devotion."
Schwarzenegger's deal with a subsidiary of American Media Inc., Weider Publications, was disclosed in March 2004. But the amount he was being paid wasn't made public until the company filed documents on Wednesday with the Securities and Exchange Commission.
At the time of the announcement, Schwarzenegger said he would take a salary that was "petty compared to the movies." The magazines also agreed to donate $250,000 a year to the California Governor's Council on Physical Fitness.
Schwarzenegger has had a relationship with the subsidiary's namesake, Joe Weider, since he left Austria for America in 1968.
The governor has admitted using steroids during his days as a champion body builder, but has since denounced them. He has continued to promote nutritional supplements, however.
"Any food supplement you take, all those are natural and will help you have more energy and help with your performance," the governor told the AP. "... No reason I thought to outlaw food supplements, something I've been on my whole life."
In vetoing Speier's bill a year ago, the governor said it was flawed because it didn't clearly define supplements and failed to adequately address steroid use. Speier has a similar bill pending this year and Schwarzenegger said he would be "more than happy" to consider the redrafted version.
"I want to do everything I can to get rid of the performance enhancing (substances)," he said Friday.
Experts on state political law said the governor's work for the magazines may not represent a technical conflict of interest because it could help an entire industry rather than an individual or specific entity.
California law allows elected officials to keep outside jobs, and Schwarzenegger does not accept his $175,000 annual salary from the state.
The contract between Weider and Schwarzenegger's production company, Oak Productions Inc., states that Schwarzenegger will receive 1 percent of the magazines' advertising revenue each year for five years. The payment will be no less than $1 million a year but could reach much higher, according to the contract.
The governor's financial disclosure filings with the state show only that he received an undisclosed amount from American Media, which also publishes The National Enquirer, Star and other celebrity tabloids.
Schwarzenegger writes monthly columns for Muscle & Fitness and Flex, and last year announced that he had agreed to serve as executive editor for both.
The SEC filing, which refers to Schwarzenegger as "Mr. S," also shows that American Media is paying $100,000 a year for five years to the Arnold Classic, an annual bodybuilding competition in Ohio.