Frances Fitzgerald has resigned as Tánaiste, after a week of mounting pressure over her handling of the Garda whistleblower controversy.
Mrs Fitzgerald - who is also resigning as Minister for Business, Enterprise and Innovation - told Cabinet colleagues of her decision only hours before she was due to face a no motion confidence motion.
Leo Varadkar confirmed in the Dáil that he had nominated himself to take over the Business portfolio for a temporary period.
He said he accepted her resignation "with regret".
Mr Varadkar said: "She was doing so to avoid an unnecessary an early general election that could have left the country without a functioning Government and Oireachtas at a crucial time for Ireland.
The Taoiseach cited Brexit talks, a finance bill, public sector pay legislation and the 8th amendment referendum next year as continuing works of Government.
He added: "All of these would fall in the event of a general election".
"It is my strong view that a good woman is leaving office without getting a full and fair hearing".
In a statement, Mrs Fitzgerald said she had made the decision "to avoid an unwelcome and potentially destabilising general election".
She said: "Throughout my career I have always sought to act with integrity and responsibility, and that is why I have decided on this occasion to put the national interest ahead of my own personal reputation.
"I have always believed in fairness and equality and these principles have guided my work as Minister for Children and Youth Affairs, as Minister for Justice and Equality, and now as Minister for Business, Enterprise and Innovation."
She added: "I decided that my continuation in office risks destabilising [the Government's] good work, and so I have decided to step-down so that this work may continue and the country can be spared an unnecessary election.
"It will also allow me to vindicate my good name at the Charleton Tribunal, without causing any further distraction to the work of the Government."
But she confirmed she will be putting her name forward to run in the next election.
Just to confirm Dublin Mid-West @FineGael Selection Convention is still going ahead this evening in @FinnstownDublin and I will be putting my name forward for Selection. Looking forward to meeting local members.
— Frances Fitzgerald (@FitzgeraldFrncs) November 28, 2017
The high-profile resignation looks set to avert a Christmas general election, which has been looming over Leinster House for the past week.
It emerged yesterday that the then justice minister received additional emails detailing the proposed "aggressive" Garda legal strategy against whistleblower Maurice McCabe during the O'Higgins Commission.
It further increased pressure on Minister Fitzgerald after a week of calls from opposition parties for the country's deputy leader to step down.
Opposition parties had seized on Mrs Fitzgerald’s handling of an email in May 2015 which alluded to the Garda strategy.
Minister Fitzgerald has continually insisted she had no knowledge of any alleged strategy until 2016, when it entered the public domain.
Following a similar Sinn Féin motion, Fianna Fáil last week tabled a motion of no confidence in the Tánaiste.
A vote in favour of the no confidence motion would have seen the collapse of the confidence and supply agreement between Fine Gael and Fianna Fáil - a development that would effectively force a general election.
The tense political situation had prompted several days of crisis talks between Taoiseach Leo Varadkar and Fianna Fáil leader Micheál Martin.
Fine Gael TDs and ministers had previously spoken out in support of the Tánaiste, with Mr Varadkar insisting he was not going to ask for her resignation.
The resignation comes less than a day after the Tánaiste had again defended her handling of the whistleblower scandal, insisting she could not have interfered with the O'Higgins Commission
2/2 The Tribunal will objectively judge the appropriateness of my conduct. I look forward to giving my evidence to the Tribunal early in January.
— Frances Fitzgerald (@FitzgeraldFrncs) November 27, 2017
Reacting to the news of the Tánaiste's resignation, Solidarity TD Paul Murphy called for further answers about the controversy from current Justice Minister Charlie Flanagan.
With Fitzgerald gone, we need answers from Charlie Flanagan in the Dail today.
— Paul Murphy (@paulmurphy_TD) November 28, 2017
Reporting by Juliette Gash, Stephen McNeice and Jack Quann