"Azhar ALi met me today and offered to step down as one-day captain as he says it has been affecting his own performances," Khan told the media in Dubai.
"I have spoken to Sarfraz Ahmed and he has given his consent to take over as the ODI captain," Khan said.
"We have appointed Sarfraz Ahmed as the new ODI captain," he added.
Wicketkeeper-batsman, Sarfraz is already leading Pakistan's national T20 squad since last year.
The PCB chief said that Azhar Ali had been forthright and said he felt the pressures of captaincy were not allowing him to focus on his own batting performances.
Khan also confirmed that long-serving Test captain, Misbah-ul-Haq had spoken to him and asked him for some time to take a decision on his future.
"Misbah has asked for some time to think over his future and he will inform us accordingly."
The PCB chief has been busy holding meetings with the Pakistan head coach, Mickey Arthur, chief selector, Inzamam-ul-Haq and the captains to discuss the future course of action after Pakistan's disappointing tours to New Zealand and Australia where they lost all five tests.
Pakistan were also drubbed 1-4 in the one-day series in Australia and the only match they won they were led by senior allrounder, Muhammad Hafeez as Azhar was unfit to play in the said match.
They had also lost last year 1-4 in the one-day series in England and are currently struggling at number eight position in the ICC ODI rankings after just securing a berth in this year's Champions Trophy in England above West Indies who are at number nine position.
Azhar who turns 32 this month was a surprise choice to lead Pakistan in ODI cricket after Shahid Afridi and Misbah retired from one-day cricket after the World Cup 2015. The board preferred him although he had not played any ODI matches since 2013.
With pressure building on him to step down after he led Pakistan in 31 matches, Azhar's decision to quit has not come as a surprise in the Pakistan cricket circles.