The Libyan parliament has passed a no-confidence vote in the newly-elected prime minister, removing him from his post.
Mustafa Abushagur, whose initial list of ministers was criticised for not being diverse enough, had until Sunday to form a cabinet or risk losing his job.
Mr Abushagur was Libya's first elected prime minister after dictator Muammar Gaddafi was overthrown last year.
The General National Congress voted 125 to 44 in favour of removing him as prime minister.
Until a replacement can be nominated, management of Libya's government is in the hands of the legislature.
Mr Abushagur represented an offshoot of the country's oldest anti-Gaddafi opposition movement, and was considered a compromise candidate acceptable to both liberals and Islamists. But he failed to produce a list of ministers that could win the approval of enough legislators.
After 40 years of Gaddafi's divide-and-rule tactics and the 2011 war, Libya's towns, tribes and regions are highly polarised. Many feel entitled to high government positions because of their losses in the war against Gaddafi and are wary of any power wielded by their rivals.
Congress will have to vote on a new prime minister in the coming weeks. The incoming leader will be responsible for rebuilding Libya's army and police force and removing major pockets of support for the former regime.
Perhaps the single greatest challenge facing the new leader is the proliferation of ex-rebel militias. One radical Islamist militia has been linked to the attack last month on the US Consulate in the eastern city of Benghazi that killed the American ambassador and three others.
There has been a widespread backlash against militias since that attack, and the Libyan government has taken advantage to try to put some of them under central government control. But some continue to resist attempts to disarm them and integrate them into the military and police.