The prime minister of the Solomon Islands, Manasseh Sogavare, has been ousted in a vote of no-confidence.
Mr Sogavare has a strained relationship with Australia
Mr Sogavare is reported to have accepted the decision, saying "parliament voted me in and parliament voted me out".
His hold on power was weakened early in November when nine ministers and three backbenchers defected from government.
There have been no reports of unrest, but large numbers of police are patrolling the capital, Honiara.
According to Reuters news agency, Mr Sogavare told parliament: "The office does not belong to my father or my family, and I have no reason to remain in this office if I believe the allegations levelled against me are true".
Mr Sogavare was appointed in May 2006 after the election of the original choice, Snyder Rini, sparked rioting.
Chinese homes and business were attacked after Mr Rini was accused of using money from Chinese and Taiwanese backers to bribe MPs into voting for him.
The opposition had previously called for Mr Sogavare to resign to "protect the integrity of parliament".
But he refused and in Thursday's no-confidence motion, put forward by opposition leader Fred Fono, he was defeated by 25 votes to 23.
He has faced domestic criticism in recent months for his abrasive style and for allegedly damaging the international image of the Solomon Islands.
He has a strained relationship with Australia, which has had a peacekeeping mission in the Solomon Islands since 2003, when it was invited there by the government to restore order.
Particularly damaging was his controversial appointment of Julian Moti as attorney-general.
The opposition said the appointment was irresponsible, because Mr Moti was wanted in Australia over child sex charges.