Indonesia — Susilo Bambang Yudhoyono made the announcement in Norway on the eve of a climate conference in Oslo.
The decision is part of a deal reached with Norway, which has agreed to contribute up to $1bn (£694m) to help preserve Indonesia’s forests.
Deforestation can lead to significant levels of carbon dioxide emissions.
“We will conduct a moratorium for two years where we stop the conversion of peat land and of forest,” President Yudhoyono said at a joint news conference with Norwegian Prime Minister Jens Stoltenberg.
The pledge comes ahead of Thursday’s climate and forest conference in Oslo, which is expected to be attended by officials from some 50 countries.
Norway says that developed nations have already promised about $500m to fight deforestation in addition to $3.5bn agreed at last December’s climate change summit in Copenhagen.
Deforestation – the burning of woodlands or the rotting of felled trees for farms, roads or towns – accounts for up to 20% of all greenhouse gas emissions from human activities.