Italian Prime Minister Giuseppe Conte on Tuesday announced his resignation.
Conte's move preempted a confidence vote that had been expected to take place on Tuesday, 12 days after Interior Minister Matteo Salvini called for such a motion, according to Politico.
Before announcing his resignation, Conte said Salvini's decision "has major consequences on the country and its economy."
"This government ends here," Conte said.
The prime minister's resignation will not automatically trigger a snap election. It is now up to President Sergio Mattarella to decide on the way forward.
Salvini's far-right League is calling for new elections, a request backed by Silvio Berlusconi's Forza Italia and the far-right Brothers of Italy party.
Meanwhile, the 5Stars — the League's current coalition partners — are reported to be in talks with the center-left Democratic Party to potentially form a new government. Such a tie-up would effectively oust Salvini's party from government.
If an alternative parliamentary majority becomes a possibility, Mattarella could decide to install a new government without fresh elections. The president could also opt for a caretaker government to pass crucial budget legislation if a majority of lawmakers are willing to back such option.