Grossman told President Clinton on Wednesday that he was leaving for personal and family reasons, said White House spokesman Joe Lockhart.
"The president and the first lady accept those reasons and applaud Mr. Grossman for the fine work he did in helping Democrats around the country in this season where we defied all historical trends as far as how parties in the White House do in midterm elections," Lockhart said.
Roy Romer, retiring governor of Colorado, will stay on as general chairman of the party, and a successor to Grossman will be named later.
Grossman is a Newton, Mass., businessman who runs his family's multimillion-dollar Massachusetts Envelope Co.
During his tenure, the DNC raised some $40 million and paid down a debt that swelled following questions about the legality of millions of dollars it received in 1996.
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