Sir David finished an almost eight-year tenure as vice-chancellor yesterday, although he will remain involved in a research and advisory role with "his old department at the medical school" where he first began a 35-year association with the university.
Sir David became vice-chancellor in 2004, when he replaced Dr Graeme Fogelberg.
"It has been a great privilege ... and naturally I will miss many aspects of the role. On the other hand, I am looking forward to the next phase of my life," Sir David said.
He has been appointed to chair the new Science Board, which the New Zealand Government established in January, while he will also chair a World Health Organisation committee on reproductive health and research.
While the two roles would involve "quite a lot of work" and travel, they would still allow him "far more time to spend with my family".
Although his contract allowed for a longer tenure, Sir David said he had always made it clear he would serve for a maximum of seven years before he stepped aside.
"I believe there is a real danger of staying on too long in this kind of role," he said in an emailed statement.
He said he doubted whether there had been any time in the last 142 years "when the future of the university has looked brighter", although he hoped the Government would invest more in university education and research, as the economy recovered.
The University of Otago is "a very special place" he said.
"I will always remember the warmth and loyalty of the staff, and the wonderful relationship with the Dunedin community - a relationship that is too long-standing and genuine to be threatened by the antics of a few students," Sir David said.
The University of Otago has always been a cornerstone of Sir David's academic career.
Born and raised in Auckland, he moved south to study medicine at Otago and also travelled on exchange to Harvard University, before he was awarded a Rhodes Scholarship at Oxford University.
He returned to Otago in 1980, when he was appointed as the departmental chair in Preventive and Social Medicine, aged 32.
He was awarded an OBE in 1990 and was knighted in 2009.
University of Otago chancellor, John Ward, said Sir David would go down in the annals of the university's history as one of its greatest contributors.
"He has admirably focused on research, people, and specific outcomes that have holistic benefits for the wider community", Mr Ward told university newsletter The Otago Bulletin, this week.
Sir David said it was difficult to single out any highlight during his time as vice-chancellor, "given so much has happened over the last seven years".
"I think the feature that has given me the most satisfaction has been the encouragement, support, and advice I have received from academic and general staff at all levels of the institution. This has been truly humbling."