The 34-year-old announced in March that he will retire at the end of his contract in June 2015, and he has now decided to step aside as captain to allow Dortmund to begin building for the future.
Kehl, who joined the club in 2002, has lead a successful period in Dortmund's history, helping the German giants to two Bundesliga titles and the DFB Pokal since taking over the armband from Christian Worns in 2008.
However, after suffering with knee injuries in recent seasons, the midfielder believes now is the right time to allow someone else to lead the side so that he can impart his knowledge if required.
"I've decided to finish being captain from right now," Kehl told the club's official website. "I've already told this decision to the club and the coach at the end of the last season.
"I was very proud to be captain of Borussia Dortmund, I was very pleased about it, it was a great responsibility for me.
"But responsibility also means for me to care for the team and for the club. And that is how I have always lived and understood my role.
"Now I want to deliver the baton, that's makes absolute sense for me and it's also sustainable.
"Now there will be the possibility to help my follower as captain and to support him with all my experience from my last years."
Kehl hopes to finish his career with another league title and believes that although Bayern Munich have dominated German football recently, Dortmund can claim some silverware this season.
"I will try to give my best in the last season of my career and to play as much as possible," he added. "My role on and of the pitch will not change.
"The greatest thing would be to win a title at the end, that would be something very special for me, and I also wish this for my follower as captain because it would be a perfect introduction for him."