The right-wing Swiss People's Party (SVP) has pulled out of the ruling coalition, ending half a century of consensus government in Switzerland.
Christoph Blocher told parliament he was disgusted by his treatment
The move followed MPs' decision to oust a nationalist SVP leader, Christoph Blocher, from cabinet and replace him with a more moderate SVP colleague.
Eveline Widmer-Schlumpf's decision to join the government was cheered by demonstrators outside the parliament.
But party colleagues in parliament say she will be excluded from the group.
Christoph Blocher told parliament he felt disgusted at the way he had been excluded from the cabinet - the Federal Council.
"Four years ago this parliament elected me as a Federal Councillor. Today you deselected me again without giving proper reasons," he said.
But, he said, he would remain active in opposition.
"The great thing about this country is that parliament can throw people out of the government but not out of politics," he told MPs.
Mr Blocher, a billionaire industrialist, played a key role in the Swiss Peoples Party's (SVP) recent election success.
The SVP won 29% of the vote in October - the highest share ever polled by a single party, though not enough to form its own government.
But its election campaign was criticised as racist by the UN and Mr Blocher's nationalist stance led to strains in the seven-seat Federal Council which is occupied by Switzerland's four main parties.
MPs decided against keeping him in the council on Wednesday, voting instead for his party colleague, Eveline Widmer-Schlumpf, by a margin of 125 to 115.
She told a joint session of parliament this morning that she would accept her election to the council.
In response, the SVP's parliamentary faction said it was going into opposition and would not recognise the ministerial position of either Ms Widmer Schlumpf or the party's second cabinet minister, Samuel Schmid.
The party will form the first opposition group seen in Swiss politics since the 1950s.