BANGKOK, Sept 15 (Reuters) - Thailand's Pita Limjaroenrat resigned on Friday as leader of the progressive Move Forward party, months after delivering a stunning electoral victory on an anti-establishment reform agenda that threatened to upend the political status quo.

Riding on a wave of youth and urban support, Move Forward was the huge surprise of the May election, thrashing parties backed by the powerful military and royalist establishment, before it was blocked by conservative lawmakers from forming a government.

Move Forward now represents the bulk of the parliamentary opposition but will retain significant political clout having won the majority of seats in and around the capital Bangkok and taken over key urban centres and some conservative strongholds.

The Harvard-educated Pita, 43, was twice denied by parliament in his efforts to become prime minister as military-appointed senators closed ranks to stop Move Forward, some over its controversial plans to amend a law that insulates the monarchy from criticism.

"I want to allow other lawmakers to take on this role of opposition leader," Pita said on Facebook.

"But in any position, I will work with Move Forward and the people to the fullest of my abilities."

The charismatic Pita had led pre-election opinion polls as Thailand's top choice for prime minister but faced a host of legal and legislative challenges that he maintains were orchestrated to keep him from power.

He is currently suspended from parliament due to a court case concerning his eligibility to run for office, stemming from shares he held in a media company, which is against election rules. Pita has denied wrongdoing.

"I will continue to work with Move Forward and fellow citizens with all my strength to drive the change we hope for," he said.