INDIANAPOLIS -- A tearful Tony Dungy said Monday he will retire after seven years as head coach of the Indianapolis Colts.

At a news conference on Monday, Dungy thanked his parents, his wife and the coaches and players he has worked with for helping him in his career.

"I'm thankful for the Lord for the career that I've had. My wife and I talked and we just thought this was the right time," he said. "I wouldn't trade these 31 years (in the NFL) for anything. I wouldn't trade the seven years I've had here ... I got to live a dream that most people don't get to live."

Dungy reminisced about talking at length with Colts Owner Jim Irsay and team President Bill Polian about how they wanted to lead the team before taking the job.

"From day one, you think optimistically that this is going to be a great job, that we're going to win, that it's going to be a great place to live and these seven years have been better than I could have ever imagined," he said. "It's been awesome to come to work everyday and know that everybody is pulling the same way for the same goals and trying to win but trying to win in the right way."

Irsay said Dungy's retirement was a "bittersweet" moment for the team.

"It's been an incredible journey. As an owner, I think that you dream about having the kind of relationship with a head coach as the kind I'd had with Tony Dungy," he said.

Polian said he needed to read from a prepared statement because he couldn't trust his emotions.

"We'll miss his faith, we'll miss his optimism, we'll miss his patience -- something he has taught me in abundance -- all of which contributes to that Dungy magic," he said.

Dungy, who was accompanied by his wife, Lauren, at Monday's news conference, met with players throughout the day to say goodbye. He will be replaced by assistant Jim Caldwell in a plan that was worked out last year.

"Jim is going to do a great job. He's ready. He's going to be fantastic," Dungy said at Monday's news conference.

Caldwell joined Dungy's staff in Tampa Bay in 2001, then moved with Dungy to the Colts in 2002 and was the quarterbacks coach. A year ago, Caldwell was elevated to associate head coach though he continued to coach Peyton Manning and Jim Sorgi.

The move comes a little more than a week after the Colts were eliminated from the playoffs.

Dungy has spent the past five years debating whether to leave football, each year taking about a week to meet with his family, which now lives in Tampa. He has always said when he left, he would not return.

He has always listed his priorities as faith, family and football, and returned to coach in 2008 when the Colts opened the new Lucas Oil Stadium only after Irsay agreed to let Dungy use a private jet to commute home.

The decision ends a tenure in Indianapolis during which Dungy became the first black coach to win a Super Bowl. He reached the playoffs all seven seasons, winning five division titles and appearing in two AFC title games.

Dungy finishes his career as the Colts' franchise leader in victories, going 85-27 in the regular season and 7-6 in the playoffs.

But Dungy's teams were also eliminated from the playoffs four times without winning a game, including the past two seasons after winning the Super Bowl -- prompting some to speculate that Dungy's indecision may have hurt the Colts' focus.

Dungy also spent six seasons in Tampa Bay, rejuvenating a moribund franchise and turning it into a perennial Super Bowl contender in the late 1990s and the early part of this decade. The 53-year-old coach left Tampa with a career record of 54-42 in the regular season becoming the winningest coach in franchise history there, too, and got the Buccaneers to the NFC title game in 1999.

He's the only coach in NFL history to produce six straight 12-win seasons and 10 consecutive playoff appearances.

Dungy's career, which includes an all-time league-high average of 10.7 regular-season wins, also included tragedy. In December 2005, his son, James, committed suicide while attending school in Tampa. He left the Colts for one game, then received the game ball from his players after they made a goal-line stand to beat Arizona in the season-finale.

The Colts' season ended two weeks later with a shocking loss to eventual Super Bowl champion Pittsburgh.

Dungy always said he intended to retire by the time he turned 50, but hung around longer because he enjoyed the game and the Colts players.

But his family priorities won out this time. His son, Eric, will be a high school senior in the fall, and those close to him thought Dungy wanted to accompany his son on college visits.

Caldwell's only other head coaching experience came at Wake Forest, where he went 26-63 from 1993-2000.