The prime minister of Somalia’s transitional government, Ali Mohamed Ghedi, has resigned.
Mr Ghedi is set to address MPs after handing in his resignation to President Abdullahi Ahmed Yusuf.
Mr Ghedi has been blamed for failing to quell the Islamist insurgency in Somalia and for bringing Ethiopian troops onto Somali soil.
On Sunday, thousands fled the capital, Mogadishu, after Ethiopian troops opened fire on protestors.
The BBC’s East Africa correspondent Karen Allen says that the prime minister’s political future has for some time hung in the balance.
She says that despite efforts to salvage his job during talks at the weekend in Ethiopia, he has agreed to step down after pressure from within Somalia and the international community, in particular from the US.
Mr Ghedi’s resignation was swiftly accepted by President Abdullahi Yusuf.
The pair have had a fractured relationship fuelled by clan rivalries during the three years they have worked together in Somalia’s transitional government.
Mr Ghedi is from the Hawiye clan, which is dominant in Mogadishu and is the largest in the country.
President Yusuf is from the breakaway northern state of Puntland and comes from the Darod clan, the country’s second largest.
Observers say the fear is that with Mr Ghedi gone, the Hawiye will now be even more united in their opposition to Mr Yusuf’s transitional government.
Aides close to the president said that the resignation was part of a deal to end what he called the political confusion in Somalia.
The Ethiopians, seen as rivals by many Somalis, have been fighting alongside Somali troops to try and restore order to the fractured country, but many see them as inflaming tensions.
Somalia has been without an effective government since civil war began in 1991, but has seen a surge in violence since Ethiopian-backed government troops ousted Islamists last December.
The UN says some 400,000 people have fled the violence in Mogadishu in the past four months.