Iraq's prime minister Adel Abdul Mahdi announced his resignation on Friday (November 29), after the country's top Shi'ite Muslim cleric urged lawmakers to reconsider their support for the government.
The country has been rocked by weeks of bloodshed and deadly anti-establishment unrest.
Over 400 people have been killed so far.
Abdul Mahdi's resignation marked the latest twist in Iraq's unprecedented crisis.
And his departure could be a blow to Iranian influence after Iran's militia allies and its own commanders intervened last month to keep the premier in his job, despite mass protests.
Young, unarmed and majority Shi'ite Muslim protesters have led demands for an overhaul of Iraq's political system.
One they say is endemically corrupt - and serves foreign powers - especially Bagdad's ally, Tehran.
Iraq's current political class is drawn mainly from powerful Shi'ite politicians, clerics and paramilitary leaders.
Including many who lived in exile before a U.S.-led invasion overthrew Sunni dictator Saddam Hussein in 2003.
Though protesters celebrated the imminent departure of the prime minister, they said they would not stop their demonstrations until the whole of the political class was removed.
The statement did not detail when Abdul Mahdi would step down.
But parliament is set to convene an emergency session on Sunday (December 1) to discuss the crisis.