Russia's finance minister, who has been in the post since 2000, has been forced to step down following criticism from Dimitry Medvedev, the Russian president.
The Kremlin annouced the news of Alexei Kudrin's departure on Monday, after Medvedev had called on him to step aside for refusing to serve in a government that Medvedev is expected to lead next year under a job swap with Prime Minister Vladimir Putin.
According to Medvedev's press secretary, Kudrin did not resign, but was sacked after a recommendation from Putin.
Under Russia's constitution, the president does not have the power to dismiss the finance minister, but can do so on the proposal of the prime minister.
Kudrin said on Sunday that he "unconditionally refused" to be in the next government and revealed for the first time that he had major policy differences with the incumbent president.
Medvedev reacted harshly to Kurdin's public refusal, asking him to leave the government.
"Such statements appear improper ... and can in no way be justified. Nobody has revoked discipline and subordination," an angry and stern Medvedev told Kudrin at a meeting of officials in the central Russian city of Volgograd.
"If, Alexei Leonidovich (Kudrin), you disagree with the course of the president, there is only one course of action and you know it: to resign. This is the proposal I make to you."
Responding to Medvedev, Kudrin said: "Yes, it is indeed true that I have disagreements with you. I will take a decision on your proposal and will consult with the prime minister [Putin]."
President Medvedev, who took over the Kremlin from Putin in 2008, announced on Saturday that he would step aside for the incumbent prime minister after March 2012 polls.
The job swap could allow Putin to extend his rule as far as 2024 while Medvedev can press on with his trademark programme of modernisation as head of government.
The polls repeatedly show that Putin remains by far Russia's most popular politician.
As the United Russia party's candidate, Putin is almost certain to win the country's top job in the March elections due to the fractured state of the Russian opposition and the Kremlin's control over the media.