The ruler of oil-rich Kuwait on Monday accepted the resignation of the government, the seventh cabinet to step down in five years, over a bitter graft dispute with parliament, official media said.
"Emir Sheikh Sabah al-Ahmad Al-Sabah issued an order accepting the resignation of the prime minister and cabinet ministers," state-run Kuwait television reported.
The emir asked Prime Minister Sheikh Nasser Mohammad al-Ahmad Al-Sabah, a senior member of the ruling family, and other ministers to manage urgent issues until a new government is formed, the broadcaster said.
The resignation came a day before the premier had been due to face a grilling in parliament over an alleged corruption scandal involving a number of MPs and on charges of misusing public funds.
That interrogation will not now take place because of the resignation and suspension of parliamentary sessions.
Hours after the resignation, the opposition staged its largest rally so far, with tens of thousands of Kuwaitis demanding the dissolution of the "corrupt" parliament and the release of 24 opposition activists.
Organisers estimated turnout at the rally at 90,000, which if confirmed would make it the largest gathering in the history of the wealthy state with a native population of just 1.2 million.
Flag-waving crowds chanted slogans including "Dissolve the parliament" as speakers called on the emir to end infighting within the Al-Sabah family which has remained in power unchallenged for more than 250 years.
It was not immediately known whether the emir, who has the ultimate say in the Gulf state in appointing heads of government, will ask Sheikh Nasser to form his eighth cabinet since he was first appointed in February 2006.
Signup to our newsletter and follow us on Facebook and Twitter!
Opposition MPs, who have been at loggerheads with Sheikh Nasser, a nephew of the emir, over charges that he failed to manage the wealthy state, welcomed the resignation.
They called for the formation of a transitional government with a new premier before parliament is dissolved.
"We are waiting for the appointment of a new prime minister before parliament is dissolved in order to be assured of fair elections," Islamist opposition MP Khaled al-Sultan told reporters outside parliament.
"I hope the emir will please the Kuwaiti people by dissolving parliament... and forming a transitional cabinet to supervise the elections," said another opposition MP, Falah al-Sawwagh.
"We are waiting for the next step to dissolve parliament, a quarter of whose members have been referred to the prosecution" over large allegedly illegal deposits in their accounts, MP Daifalla Buramia said.
The public prosecutor in September launched an unprecedented probe into the bank accounts of around 15 pro-government MPs accused of accepting bribes totalling $350 million.
Opposition MPs have claimed the deposits were bribes by the government so it would win votes on crucial issues. Some of the MPs accused have denied any wrongdoing.
The most tumultuous period in Kuwait's modern history has now seen seven cabinets resign since mid-2006 and parliament dissolved three times. In 1962 it became the Gulf's first Arab state to adopt a democratic system.
Kuwait, which sits on about 10 percent of global crude oil, has amassed more than $300 billion in surpluses over the past decade, but projects and development have been stalled by the political wrangling.