Australia's Prime Minister Tony Abbott has been ousted by rival Malcolm Turnbull in a sudden party leadership vote following weeks of infighting and dismal opinion polls.
Mr Turnbull, a former investment banker and self-made millionaire, will become Australia's fourth leader in nearly three years.
Defeating Mr Abbott in a 54-to-44 Liberal Party vote yesterday, Mr Turnbull immediately signalled that he wants to lead a "traditional" consultative government and that his top priority will be to focus on the economy and innovation.
"This will be a thoroughly Liberal government committed to freedom, the individual and the market," he said.
"The Australia of the future has to be a nation that is agile, that is innovative, that is creative," he added.
The successful challenge followed weeks of leadership speculation, triggered by a long run of dismal opinion polls for the coalition.
The polls suggested the ruling conservative coalition under Mr Abbott would have faced a wipe-out at the next election, due by the end of next year.
Mr Turnbull, 60, will formally become prime minister when he is sworn in by the Governor-General after Mr Abbott resigns - a process which is likely to occur over the coming days.
Widely regarded as a far more progressive leader than Mr Abbott, Mr Turnbull said he did not plan to pursue dramatic changes and indicated he would restrain his own personal support for same-sex marriage and strong action to combat climate change. He praised Mr Abbott's tough approach to asylum-seekers arriving by boat and the signing of free trade agreements with South Korea, Japan and China.
Mr Abbott, a successful opposition leader, struggled in the opinion polls after winning a decisive election victory in 2013. Last year, he delivered an unpopular first Budget, widely seen as unfair, particularly to the poor and disadvantaged.
He had never been publicly popular, but the Budget - followed by a widely mocked decision to award a knighthood to Britain's Prince Philip - further damaged his standing. This led to leadership instability and a party-room revolt which he survived earlier this year.
Struggling to fend off the surprise challenge yesterday, Mr Abbott warned that switching leaders would repeat the mistakes of the previous Labor government. Labor lost public credibility after twice ousting sitting prime ministers - Mr Kevin Rudd in 2010 and Ms Julia Gillard, who was deposed by Mr Rudd in 2013.
"The prime ministership of this country is not a prize or a plaything to be demanded," Mr Abbott said. "It should be something which is earned by a vote of the Australian people."
But fellow MPs ignored his warning, apparently believing that Mr Abbott would be unable to reverse the government's unpopularity.
Following his loss of the leadership last night, Mr Abbott did not make a public statement.
Foreign Minister Julie Bishop, who backed Mr Turnbull's leadership bid, was re-elected deputy party leader in a 70-to-30 vote against Defence Minister Kevin Andrews.
Mr Turnbull said he did not plan to call an early election and would serve out the remaining 12 months or so of the current term.
Announcing his leadership challenge yesterday afternoon, he warned that Mr Abbott had failed to provide economic leadership.
Mr Turnbull, an MP since 2004, said he will announce his new Cabinet at the end of this week's parliamentary sitting.