Alexis Tsipras has announced his resignation as Prime Minister of Greece after 206 turbulent days in power.
The Syriza leader said in a televised announcement that he will submit his resignation to Greek president Prokopis Pavlopoulos shortly, triggering a national election.
Vassiliki Thanou-Christophilou, the head of Greece's Supreme Court is expected to replace Tsipras and oversee the elections as head of a caretaker government.
An earlier report from Reuters claims the election will take place on 20 September, citing an unnamed Greek official.
Tsipras lost the backing of many of his fellow Syriza MPs after agreeing to austerity measures to secure billions of pounds in bailout funds from Europe.
The European Central Bank today said that €3.4bn of Greek government bonds which matured today have been repaid, after the country received the first tranche of bailout money worth €13bn.
The Greek government agreed to widespread austerity measures, including pension reforms and public sector cuts to secure the cash and the country's membership of the European Union, however, Tsipras faced a rebellion by 43 out of 149 Syriza MPs when the measures were voted through. This effectively lost him his parliamentary majority.
In his speech, Tsipras said the country had not secured the agreement it had wanted but the deal was the best one under the circumstances.
He said that he no longer had the mandate of the Greek people which he received when Syriza was first voted into power in January on an anti-austerity platform, and they "must decide anew". He said he would seek the vote to continue with the government's programme.
It leaves Greece with fresh uncertainty when the final agreement on a bailout deal had seemingly secured the county's future.
"An election will create more political uncertainty, delay economic recovery and impede reform implementation. However, it appears to be unavoidable if Greece is to have a government committed to implementing the bailout agreement," the Economist Intelligence Unit's Joan Hoey told the BBC.