Unprecedented street unrest against a Palestinian Authority widely seen as corrupt, resistant to reform and out of touch spurred Prime Minister Ahmad Quraya to resign, touching off a leadership crisis that some fear could turn into civil war.
Lawmakers at a crisis session voted 43-4 for a resolution calling on Arafat to accept Quraya's resignation, which would dissolve his cabinet, and appoint a government "capable of carrying out its responsibilities" - a veiled demand to endow it with powers to impose law and order.
Quraya had grown frustrated with his lack of power to make Palestinian institutions, above all a muddle of security agencies plagued by feuding and cronyism, more democratic and accountable.
He submitted his resignation on Saturday only to be refused by Arafat.
International mediators regard such reforms as critical to reducing violence in the Palestinian conflict with Israel and salvaging a "road map" peace plan.
Meanwhile, a vocal pro-reform critic of Arafat was shot and wounded by men firing into his Rama Allah home on Tuesday in what seemed to be part of a chaotic power struggle.
The shooting followed a weekend of fighting between security forces loyal to Arafat and young fighters within his Fatah movement demanding sweeping reforms and a clean-up of graft.