The 85-year-old Benedict, who said on Monday that he would step down on February 28 because of his advancing age,will hold a general audience from his window on the square at0930 GMT.
He will go on to celebrate an Ash Wednesday mass in St.Peter's Basilica at 1400 GMT, his last public mass and one of his last engagements as pope.The mass is traditionally held in the Santa Sabina Churchon Rome's Aventine Hill.
On this occasion however it has been moved: out of respect for the outgoing pontiff, and to accommodate the crowd of faithful who will want to mark the end of his eight-year rule one of the shortest in the Church's modern history.
"It will be an important concelebration, and the last led by the Holy Father in San Pietro," Vatican spokesman Federico Lombardi said. Key cardinals were expected to attend as the papal conclave begins gathering in Rome to elect the next pope.
No date has yet been set for the secret conclave, which will meet in the Sistine Chapel under Michelangelo's famous ceiling frescoes, but it could come within days of Benedict's resignation.
Lombardi has said he expects a new pope in place in time for Easter, which falls on March 31 this year. Secretary of State Tarcisio Bertone will govern the Church during the transition.
Candidates for the Vatican's top job will join bishops, monks, friars and pilgrims for the Ash Wednesday celebrations, during which the pope anoints the foreheads of the faithful with ashes, launching a period of penitence before Easter in the Christian calendar.
Benedict's surprise decision to step down -- making him the first pontiff in 700 years to resign simply because he cannot carry on sparked a flurry of rumours over his health, fed by revelations that he had had an operation to replace the batteries in his pacemaker three months ago.
His decision was seen by some as a bid to avoid the fate of Benedict's predecessor John Paul II, whose drawn-out and debilitating illness was played out on the world's stage.
The Vatican has insisted the pontiff suffers from nothing worse than arthritis and old age. After Ash Wednesday Benedict will hold another general audience and recite the Angelus twice from his apartment window on St. Peter's Square before retiring to a secluded monastery, the Vatican added.