Vaughan announced he was to step down with immediate effect this afternoon following the series defeat to South Africa which was sealed at Edgbaston on Saturday.

Paul Collingwood also revealed he was to follow the Yorkshire batsman by quitting his role as captain of the one-day side.

Pietersen, England's star batsman, is one of the the favourites to take over both jobs, with Andrew Strauss and Andrew Flintoff also in contention.

And Atherton insists it is the South Africa-born Pietersen who should be given the chance to lead his adopted country.

"If you're talking about someone to take on both jobs then Kevin Pietersen becomes the number one candidate because he's one of the few people who can be guaranteed their place in both teams," he told Sky Sports News.

Atherton also suggested that Collingwood may have been pressured into quitting the one-day role as England look to revert back to a single captain.

"Michael Vaughan's decision is his own decision, but I can't believe that Paul Collingwood made that decision off his own back," he said.

"Clearly they want to unite the job and get one bloke in there, and they've given Paul a gentle nudge to say that this is in the best interests of the team."

Atherton was glowing in his praise of Vaughan and was sympathetic of the pressures that moved him to step aside.

He continued: "He's been a wonderfully successful captain, England's most successful in terms of Test match wins, and is surely one of England's greatest ever captains.

"In terms of playing, captaining, leading, decision-making, Michael Vaughan is the best man for the job."

He added: "I know what he's been going through.

"It's a wonderful job but it's also a job that becomes all-consuming. He said he's not been himself at home and wanted to 'get back to being me'.

"The job gets on top of you. It's a great job but you're thinking about it all the time.

"When you're supposed to be at dinner with friends or the wife, you're thinking about who should be opening the bowling the next day and how to tell your mate he's not in the next team.

"That pressure eventually bears down on you and if you're not getting runs as well then it becomes very difficult."

Former Test star Graham Thorpe also thinks Pietersen should lead England.

Thorpe told Teletext: "It leaves a big hole for England and a really tough decision for the selectors to make just a year out from the Ashes, which is their stated aim.

"(National selector) Geoff Miller's stated preference is for a single captain in both forms of the game and that leaves the field looking pretty thin.

"Only Pietersen stands out from the players that are currently playing both forms of the game. Both Andrew Strauss and Robert Key could be accommodated in the one-day side, probably at the expense of Alastair Cook, but I think Pietersen is the man they should go with.

"There would be concerns about putting that workload on your best player, but it could be the making of him.

"People talk about his occasional lack of responsibility, but I think that the captaincy could settle him down a bit."

Thorpe, who played 100 Tests for his country before retiring in 2005, at the time of Pietersen's emergence, believes both Strauss and Key are interesting options.

But he feels neither man is established enough in the England set-up to warrant the job.

"Strauss has done the job before in Test matches and certainly showed some promise as a captain," Thorpe said.

"But that was when he was a key player in the side, and at the moment, I'm not sure he has totally cemented his place in the team again.

"Likewise, it would be a tremendous amount of pressure to place upon Rob Key who should first be given the chance to prove himself in Tests again."

Thorpe played under Vaughan's leadership at the end of his own international career and paid tribute to a man who stands unrivalled as England's most successful captain.

He added: "He had been thinking about if for a while but kept it so close to his chest that I don't think many people would have been aware it was in his thoughts.

"There's absolutely no doubt that Michael Vaughan is an exceptional captain and his record states clearly he's up there with the very best.

"He was the right man at the right time to lead the team he had been given. A more laid-back captain than Nasser Hussain, he gave the team the freedom it needed.

"And he will always have the Ashes win in 2005 as his crowning glory."

South Africa captain Graeme Smith was sorry to see his counterpart quit after inadvertently delivering the knockout blow to his reign with a match-winning 154 not out yesterday.

"It has come as a shock to me," Smith told BBC Sport.

"I have the highest regard for him as person, sportsman and leader. It is a great loss for world cricket."

Yorkshire captain Darren Gough, who will welcome Vaughan back for his side's battle to remain in LV County Championship Division One, was surprised he decided to step down.

"I am very disappointed for Michael Vaughan and for England because I thought he was an excellent captain and leader," Gough said.

"I said on my radio show last week that I thought he should stay on as England captain.

"He is a terrific player and, like Collingwood, is probably only one innings away from resurrecting his form.

"The timing is never right when to resign but it tends to be when you have lost a series. I think that pressure from outside has built up sufficient for him to say enough is enough.

"He was well respected by the players and I thought he should have waited until after India to make a decision but it is up to him and he has decided to do it now."