"It's been an honor to serve the people of South Carolina in United States Senate for the past eight years, but now it's time for me to pass the torch to someone else and take on a new role in the fight for America's future," DeMint said in a statement posted on his website.
While he said he was leaving the Senate, he was not "leaving the fight."
"I've decided to join The Heritage Foundation at a time when the conservative movement needs strong leadership in the battle of ideas," DeMint said. "No organization is better equipped to lead this fight and I believe my experience in public office as well as in the private sector as a business owner will help Heritage become even more effective in the years to come."
DeMint, who will leave the Senate in January, takes over for Edwin J. Feulner, who announced Thursday he will step down in April as president of the well-respected conservative think tank he envisioned then founded.
DeMint said he was "humbled" to succeed Feulner, "who built the most important conservative institution in the nation. He has been a friend and mentor for years and I am honored to carry on his legacy of fighting for freedom."
"This is a crucial moment for America and for the conservative movement, and we are seizing it," said Heritage Chairman of the Board Thomas A. Saunders. "Ed Feulner has made Heritage not just a permanent institution on Capitol Hill, but the flagship organization of the entire conservative movement."
DeMint, Saunders said, "has shown that principled conservatism remains a winning political philosophy. His passion for rigorous research, his dedication to the principles of our nation's founding and his ability to translate policy ideas into action make him an ideal choice to lead Heritage to even greater success."
His conservative stance made him beloved among the party's grassroots members. DeMint exercised influence through his Senate Conservatives Fund, which supported more ideologically "pure" candidates over candidates preferred by the GOP establishment.
DeMint also authored legislation concerning balancing the budget, banning earmarks, revising the tax code and reforming entitlement programs.
DeMint was elected to the U.S. House of Representatives in 1998, leaving after a three terms. He was elected to the U.S. Senate in 2004 and re-elected in 2010.
Feulner will remain at the foundation as its chancellor and chairman of its Asian Studies Center, Saunders said.