Tunisian Prime Minister Hamadi Jebali has announced his resignation at a news conference in Tunis.
"I promised if my initiative did not succeed I would resign as head of the government and this is what I am doing following my meeting with the president," Jebali said at the presidential palace.
"Today there is a great disappointment among the people and we must regain their trust and this resignation is a first step."
An aide had hinted that Jebali might resign earlier on Tuesday, after the ruling Ennahda party rebuffed his plan to form a non-partisan cabinet to steer Tunisia through a crisis caused by the killing of leftwing politician Shokri Belaid.
Jebali, who had warned of chaos if his plan fell through, made a last ditch effort to push for "another solution" and was due to meet President Moncef Marzouki later in the afternoon.
Jebali met the cabinet in the morning to say goodbye and to ask them to "continue to expedite current matters," one government member said.
Ennahda's leader, Rachid Ghannouchi, had put forward his own proposal on Monday for a mixed government of politicians and technocrats and had said there was a consensus among political parties for Jebali to remain prime minister.
Jebali did not rule out accepting if he was charged by the president once more to form a new government, but he said any new cabinet he would lead must be free from partisan haggling, inclusive and charged primarily with holding new elections.