BELFAST, United Kingdom (AFP) - Northern Ireland's first minister dramatically resigned on Thursday in a crisis caused by suspicions over Irish Republican Army (IRA) activity threatening the British province's hard-earned political stability.

Peter Robinson of the pro-British Democratic Unionist Party (DUP) said he and his ministers would step down from the power-sharing government in Belfast.

However, Robinson's resignation does not bring about the immediate collapse of the administration and he has asked a DUP colleague, Arlene Foster, to step in as acting first minister.

The DUP have been in power since 2007 alongside republicans Sinn Fein.

The latter was the political wing of the IRA paramilitary group during some 30 years of sectarian violence known as The Troubles in which 3,500 people died and which was largely ended by a peace deal in 1998.

Robinson's decision follows a complex chain of events triggered by the murder of former IRA gunman Kevin McGuigan in Belfast last month.

On Wednesday, a senior figure in Sinn Fein, Bobby Storey, was arrested in connection with the killing, prompting Robinson to announce he could be prepared to step down.

Storey was released by police on Thursday evening and his lawyer said he would now be suing for unlawful arrest.

CONTRIVED OR REAL?

The governments of both Ireland and Britain, which are chairing talks to resolve the crisis, have voiced grave concern about the latest developments.

"Following today's serious developments, the power-sharing institutions are on the edge of the precipice," said Irish foreign minister Charlie Flanagan.

"I urge Northern Ireland's political leaders to take a step back and consider the gains achieved over recent years, the benefits to the people of Northern Ireland and what is now at stake."

A spokesman for Prime Minister David Cameron's Downing Street office said he was "gravely concerned" and had spoken to Robinson.

"The prime minister said that there should be a return to the spirit that had seen politicians show such leadership over the years to deliver a peace process that has inspired people across the world," the spokesman added.

Earlier Thursday, a cross-party committee of the Northern Ireland Assembly voted against a DUP call for the assembly to be adjourned.

Robinson's resignation came shortly afterwards.

"I am... standing aside as first minister and other DUP ministers will resign with immediate effect with the exception of Arlene Foster," he said in a statement.

"I have asked Arlene to remain in post as finance minister and acting first minister to ensure that nationalists and republicans are not able to take financial and other decisions that may be detrimental to Northern Ireland."

Following that move, Sinn Fein's president Gerry Adams said the release of Storey showed the "contrived nature of the current crisis".

"I want to reiterate my grave concern about the nature in which the murder of two men has been exploited and also at the way the current difficulties have developed in the last few weeks, including the arrest of Bobby Storey," Adams said.

Republicans allege that the controversy is down to jockeying for position amongst unionist parties ahead of elections scheduled to take place next year which could now be brought forward.

While the British government could theoretically suspend the assembly following Robinson's resignation, it has indicated it will not do so.

This means that government departments in Northern Ireland will still function but the executive will not meet.

The assembly was last suspended between 2002 and 2007 in a row over alleged IRA intelligence gathering in the assembly.

That led to Northern Ireland being governed under direct rule from London, as was the case during The Troubles.

Three men accused in that intelligence gathering case later had the charges against them dropped