José Manuel Soria said in a statement that he had tendered his resignation "in light of the succession of mistakes committed along the past few days, relating to my explanations over my business activities... and considering the obvious harm that this situation is doing to the Spanish government."
Soria's troubles began on Monday when Spanish online daily El Confidencial, which has had access to the Panama Papers - files leaked from law firm Mossack Fonseca - said he had was an administrator of an offshore firm for two months in 1992.
Soria called a news conference to deny any link to any Panamanian company, but as the week went by, more allegations emerged from other media outlets, revealing further alleged connections to offshore havens.
It is unclear as yet whether any of his alleged actions were illegal.
Soria is the latest political victim of the Panama Papers, which resulted from what the law firm blamed on a computer hack launched from abroad, and revealed how the world's wealthy stashed assets in offshore companies.
Iceland's Prime Minister Sigmundur David Gunnlaugsson was also forced to resign over the leaks.