Liz Truss has dramatically quit after just 44 days in No 10 - making her Britain's shortest-serving Prime Minister ever.
The Tory leader announced her resignation after weeks of turmoil in Downing Street and furious backbench MPs expressing no confidence.
In a statement of just 88 seconds, Ms Truss said she was unable to deliver on her mandate from the summer's Conservative Party leadership election.
In extraordinary scenes, she said will stay on in No10 until a successor is chosen via a leadership election to be held within the next week.
Speaking in Downing Street, she said: "I have therefore spoken to His Majesty the King to notify him that I am resigning as leader of the Conservative Party.
"This morning I met the chairman of the 1922 Committee, Sir Graham Brady.
"We've agreed that there will be a leadership election to be completed within the next week.
She added: "This will ensure that we remain on a path to deliver our fiscal plan and maintain our country's economic stability and national security."
"I will remain as Prime Minister until a successor has been chosen. Thank you."
Ms Truss's resignation smashes the record of the shortest-serving Prime Minister George Canning, who died in office after just 119 days.
On Friday the embattled Prime Minister was forced to sack her close friend and Chancellor Kwasi Kwarteng after the disastrous mini-Budget unravelled.
Ms Truss then ripped up the tax-slashing proposed just last month - a humiliating U-turn on pledges made during the summer's Tory leadership contest.
On Wednesday the Home Secretary Suella Braverman quit her role and discipline among Tory MPs also broke down amid chaotic scenes in the Commons.
Just moments after her annoucement Sir Graham also told reporters the new Tory leader would be in place by Friday 28 October.
Former Prime Minister Boris Johnson, who resigned in scandal in July, is also being tipped to take a shot at the leadership - supposedly in the "national interest".
A friend of Mr Johnson told the Mirror they did not know if he was planning to stand but added: "You know what he says about the ball coming loose in the scrum.
“I think it would be in character if he did."
But Ms Truss's decision to quit No10 - triggering a fresh leadership contest in the Tory party - immediately led to mounting calls for a general election.
The Labour leader Keir Starmer said: "The Conservative Party has shown it no longer has a mandate to govern.
“The Tories cannot respond to their latest shambles by yet again simply clicking their fingers and shuffling the people at the top without the consent of the British people.
"They do not have a mandate to put the country through yet another experiment; Britain is not their personal fiefdom to run how they wish.
He went on: “The British public deserve a proper say on the country's future. They must have the chance to compare the Tories’ chaos with Labour’s plans to sort out their mess, grow the economy for working people and rebuild the country for a fairer, greener future. We must have a chance at a fresh start. We need a general election - now.”
Scotland First Minister Nicola Sturgeon said a general election was a "democratic imperative" after the resignation of the Prime Minister.
"There are no words to describe this utter shambles adequately," the First Minister stressed.
"It's beyond hyperbole - & parody. Reality tho is that ordinary people are paying the price.
"The interests of the Tory party should concern no-one right now. A general election is now a democratic imperative."
The Lib Dem leader Ed Davey also demanded a public vote, saying: “Boris Johnson failed our country and Liz Truss trashed our economy. The Conservatives have proven time and time again they are not fit to lead our great country.
“We do not need another Conservative Prime Minister lurching from crisis to crisis, we need a general election, we need the Conservatives out of power and we need real change."
Just hours before her statement, the Prime Minister's spokesman insisted she would be leading the Tories into the next general election.
But as he answered journalists' questions, it emerged the Chairman of the 1922 Committee Sir Graham Brady was meeting with Ms Truss - triggering frantic speculation.
Sir Graham is known in Westminster as the gatekeeper of Tory MPs' letters of no confidence and was invited for a meeting with the Prime Minister on Thursday.
Shortly after Ms Truss's close friend and Deputy Prime Minister Therese Coffey arrived at No10 alongside the Tories' chairman Jake Berry as the Tory leader's departure was finalised.
