Billionaire investor Carl Icahn resigned Friday from the board of Yahoo with immediate effect, saying the Internet giant no longer need an activist investor.

Carl Icahn, who joined company's board previous year after threatening a proxy fight, had played a key role in the removal of Jerry Yang as CEO.

He accused Jerry Yang of acting against the interests of company's shareholders.

After that Yahoo replaced Jerry Yang with Carol Bartz and entered a search and advertising deal with Microsoft.

Board's chairman Roy Bostock praised Carl Icahn for his active role in shaping Yahoo.

Speaking on the issue, Roy Bostock added, "Carl has been an important member of our board and has helped us through some significant transitions."

In the after-hours trading, shares in Yahoo dropped nearly 2 per cent to $16.90-a-sahre.