HOUSTON -- Rudy Tomjanovich stepped down as coach to take another job with the Houston Rockets on Friday after 12 seasons that included the franchise's only two NBA championships.

Tomjanovich, who had cut his season short for treatment of bladder cancer, said he looked forward to resuming a more normal lifestyle.

"Just to be one of the people in this city, being a soldier instead of a general for a while, I look forward to that,'' Tomjanovich said, choking back tears as he announced his decision.

"I just think at this stage, with the health situation, that the best thing is to back off and try to be just a regular guy for a while.''

Tomjanovich, appearing at a news conference with longtime friend and general manager Carroll Dawson, confirmed news reports about his negotiations with owner Les Alexander to take another position despite having two years and $12 million remaining on his contract.

Was Rudy shoved off bench?

It was widely known in NBA circles that Rockets owner Les Alexander was not pleased with the team's inability to make the playoffs for a fourth straight season. Adding to his angst were an all-Texas matchup of San Antonio and Dallas in the conference finals, and Houston's forthcoming move into a new building in October. Rudy Tomjanovich, while regarded as a living legend after more than three decades with the Rockets, has been criticized in recent years for relying too much on the one-on-one skills of point guard Steve Francis and shooting guard Cuttino Mobley. Tomjanovich, whose season was cut short by bladder cancer, in recent weeks indicated that he was feeling increasingly better and eager to resume his coaching duties next season. That meant Alexander, if he wanted a coaching change, would either have to fire the face of the franchise or convince Tomjanovich to negotiate a buyout of his contract. It appears that Tomjanovich finally relented, agreeing to negotiate a settlement and then move to the front office. The possibility remained that health reasons might have forced Tomjanovich to leave the bench anyway, but that determination was to be made next month, when Tomjanovich will undergo a biopsy to assess his recovery from cancer. The Rockets are now free to pursue former Knicks coach Jeff Van Gundy, who has already interviewed with the Cleveland Cavaliers. It's hardly a stretch, though, to suggest that the Houston job would be more attractive to Van Gundy, given Francis' more advanced stage of development and Yao's fine rookie season. Coaching James in his home state, with all the scrutiny he's likely to generate, could easily be viewed as the tougher job, albeit removed from the ultra-competitive Western Conference. For Tomjanovich, meanwhile, it was a hasty finish to a lifetime of success with the only team he has ever known. His coaching career, however, isn't necessarily over. After winning two championships and an Olympic gold medal, Tomjanovich will undoubtedly have the opportunity to coach elsewhere in the future if he wishes. -- Marc Stein, ESPN.com

ESPN's David Aldridge reported that while health considerations were a factor in Tomjanovich's decision to step down, Alexander has been unhappy for months with the development of some of the team's young players, like Steve Francis and Cuttino Mobley. Discussions about Tomjanovich's future began before he was diagnosed with a cancerous tumor on his bladder on March 18 and continued after the season ended.

"This is a very difficult day for the entire Rockets organization,'' Alexander said in a statement. "I know this was a hard decision for Rudy, but I respect it. Rudy is a great championship coach. While I am saddened to see him move from the sideline, I look forward to working with him to make this a championship team again.''

Tomjanovich led the Rockets to the NBA title in 1994 and 1995 but the team hadn't made the playoffs the past four seasons.

Dawson said Tomjanovich would help the Rockets in scouting and evaluation.

"Rudy is still going to be with us, that's what makes this easier than it normally would,'' Dawson said. "We've been blessed to have him for 33 years and he's still going to be here.''

"I'm always going to be a Rocket,'' Tomjanovich said.

"We are very blessed to have as capable a guy in this game as I know,'' Dawson said. "I am sure one day he will be in the Hall of Fame.''

Tomjanovich, 54, took over as the Rockets' coach midway into the 1991-92 season and compiled a 503-397 record, becoming easily the winningest of the team's nine coaches. The Rockets' championships were the city's first titles in a major sports league.

Only Utah's Jerry Sloan, who just completed his 15th season, had a longer tenure among active coaches than Tomjanovich.

"I am going to work with everybody in the front office to go and try to help add some pieces to what we already have and get the Houston Rockets back on top,'' said Tomjanovich, who has concluded cancer treatments and will undergo a biopsy next month to see if the tumor is gone. "It is a good situation.''

Rockets guard Steve Francis said losing Tomjanovich was tough.

"It was hard for me to believe,'' Francis told KRIV.

"Hopefully for this team things will get better. I'm gonna have to talk to coach before I make a decision as far as myself on which way I think we are going to go.''

The Rockets made Tomjanovich the second overall selection in the 1970 draft out of Michigan. He started the franchise's first game in Houston on Oct. 14, 1971, after the Rockets moved from San Diego.

"Rudy T,'' as he is called, quickly became one of the team's most popular players and had 13,383 points and 6,198 rebounds in his 11-year playing career, averaging 17.4 points and 8.1 rebounds in 768 games. He last played in 1981 and the team retired his jersey the following year.

Tomjanovich also survived one of the scariest moments in NBA history on Dec. 9, 1977, when Los Angeles Lakers forward Kermit Washington blindsided him with a powerful punch that sent him crashing to the floor with shattered facial bones. Doctors later said the injuries were life-threatening, but Tomjanovich returned the following season wearing a protective mask and made one of his five appearances in the NBA All-Star game.

Tomjanovich has spent all 33 years since leaving Michigan -- which also retired his jersey this year -- with the Rockets as a player, scout or coach.

This season, news of cancer on the surface of his bladder forced Tomjanovich to miss the final 17 games of a disappointing season in which Houston finished 43-39 despite having two All-Star starters, guard Francis and 7-foot-6 rookie Yao Ming.

His current contract, agreed to in 2000, was set to keep him coaching until 2005.

Information from The Associated Press was used in this report.