Macron's announcement comes two months after a coup in the west African country that ousted the pro-Paris president.
"France has decided to withdraw its ambassador. In the next hours our ambassador and several diplomats will return to France," Macron told French television in an interview, without giving details over how this would be organised.
Macron added that military cooperation was "over" and French troops would withdraw in "the months and weeks to come" with a full pullout "by the end of the year".
Niger's military rulers responded swiftly in a statement read out on national television.
"This Sunday, we celebrate a new step towards the sovereignty of Niger," said the statement from the military rulers, who seized power by overthrowing President Mohamed Bazoum on July 26.
"This is a historic moment, which speaks to the determination and will of the Nigerien people," the Niger statement added.
- Ban on French aircraft -
Earlier Sunday the Agency for the Safety of Air Navigation in Africa and Madagascar (ASECNA) said on its website that the military rulers had banned "French aircraft" from flying over the country's airspace.
It was not clear if this would affect the ambassador being flown out.
In his comments, Macron said that "in the weeks and months to come, we will consult with the putschists, because we want this to be done peacefully".
France keeps about 1,500 soldiers in Niger as part of an anti-jihadist deployment in the Sahel region. Macron said the post-coup authorities "no longer wanted to fight against terrorism".
Niger's military leaders had told French ambassador Sylvain Itte to leave the country after they overthrew Bazoum.
But a 48-hour ultimatum for him to leave, issued in August, passed with him still in place as the French government refused to comply, or to recognise the military regime as legitimate.
Earlier this month, Macron said the ambassador and his staff were "literally being held hostage" in the mission, eating military rations with no food deliveries.
In Sunday's interview, Macron reaffirmed France's position that Bazoum was being held "hostage" and remained the "sole legitimate authority" in the country.
"He was targeted by this coup d'etat because he was carrying out courageous reforms and because there was a largely ethnic settling of scores and a lot of political cowardice," he argued.
- 'Very worried about region' -
The coup against Bazoum was the third such putsch in the region in as many years, following similar actions in Mali and Burkina Faso in 2021 and 2022 that also forced the pullouts of French troops.
But the Niger coup is particularly bruising for Macron after he sought to make a special ally of Niamey, and a hub for France's presence in the region following the Mali coup. The US also has more than 1,000 troops in the country.
Macron regularly speaks by phone to Bazoum, who remains under house arrest in the presidential residence.
The French president has repeatedly spoken of making a historic change to France's post-colonial imprint in Africa but analysts say Paris is losing influence across the continent especially in the face of a growing Chinese, Turkish and Russian presence.
The Economic Community of West African States (ECOWAS) threatened military action to restore Bazoum but so far its threats, which were strongly supported by France, have not transferred into action.
"We are not here to be hostages of the putschists," said Macron. "The putschists are the allies of disorder," he added.
Macron said that jihadist attacks were causing "dozens of deaths every day in Mali" after its coup and that now such assaults had resumed in Niger.
"I am very worried about this region," he said.
"France, sometimes alone, has taken all its responsibilities and I am proud of our military. But we are not responsible for the political life of these countries and we draw all the consequences."
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