Reports suggested this morning that West Ham would turn to former Forest skipper Stuart Pearce after having two official approaches for Pardew turned down by their chairman John Majedski.
Pardew told the Press Association: "I wish to announce my resignation from Reading Football Club with immediate effect.
"My main issue has always been the opportunity to speak to West Ham United Football Club which has been denied to me."
Reading beat Forest 3-0 earlier in the season and managed a playoff place last season but lost in the semi-finals to Wolves.