The Netherlands' top diplomat made the announcement to parliament in The Hague on Tuesday.
Zijlstra had long claimed that he was present as a guest at Putin's vacation home in 2006 when the Russian leader made controversial comments about "greater Russia." The Dutch minister later warned of Russian aggression in Ukraine, Kazakhstan and the Baltics.
But on Monday, Zijlstra admitted to newspaper De Volkskrant that he was never at the meeting and had not heard the comments directly - a damaging disclosure that made his position in Prime Minister Mark Rutte's centre-right coalition government untenable.
Zijlstra told parliament that the credibility of the Foreign Ministry should never be in doubt.
"In order not to burden the office of foreign minister, I see no other option than to offer my resignation to the king today," he said.
Rutte described Zijlstra's mischaracterization of the meeting as a "big mistake."
Former Shell chief executive Jeroen van der Veer was Zijlstra's source for Putin's comment. But Van der Veer says the minister misquoted him, and that Putin was only talking about a "greater Russia" in a historical sense.
Zijlstra's resignation came on the same day he had been due to travel to Moscow. The visit was cancelled.