Bill Gates speaks during an event in Washington. File / AP

The billionaire and his wife Melinda run one of the world's largest charities, the Gates Foundation, which has billions in assets and funds global health programmes to combat disease and poverty.

Gates quit his full-time executive role at Microsoft in 2008 and remained as chairman of the board till 2014. Since then he has been a board member.

"It's been a tremendous honor and privilege to have worked with and learned from Bill over the years," Chief Executive Officer Satya Nadella said.

With the departure of Gates from Microsoft Board, it will now consist of 12 members, the company said.

Gates also stepped down from the board of Warren Buffett's Berkshire Hathaway Inc, where he has served since 2004.

A signage of Microsoft is seen on Friday in New York. AFP

Gates grew up in Seattle with two sisters. His father William was an attorney and his late mother Mary was a schoolteacher and chairwoman of United Way International.

He began programming computers as a 13-year-old student, and fell in love with the machines.

Among the tales told about Gates is that while working on school computers, he tinkered with programming to put himself in classes made up mostly of girls.

With his parents' blessing, Gates dropped out of Harvard to start "Micro-soft" with his late childhood friend Allen.

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A key move was to focus on licensing software to computer makers in numerous "partnerships" that resulted in affordable machines being available to the masses.

As the personal computer market grew, Microsoft became the world's top software company. Its virtual monopoly led to a much-publicized antitrust trial, in which the company managed to avert a break-up but had to endure years of government monitoring.

Gates went on to turn his attention from software to fighting disease and other humanitarian challenges with his wife, under the auspices of the Bill and Melinda Gates Foundation.

"This move is not surprising to the Street as Gates has continued to focus more on his myriad of philanthropies across the globe over the past decade," Wedbush analyst Daniel Ives said in a note to investors.

"Gates is a historic figure in the technology world and his legacy at Microsoft will be felt in Redmond for decades to come."