Lebanon's Syrian-backed Prime Minister Omar Karami, who has been facing growing popular pressure following the killing of former Prime Minister Rafik Hariri, said on Monday his government was resigning.
"Out of concern that the government does not become an obstacle to the good of the country, I announce the resignation of the government I had the honor to lead," Karami told parliament in Beirut.
The decision marks the first time in modern history an Arab government falls in the wake of popular pressure.
Parliament members left the special session immediately after the resignation announcement.
Meanwhile, tens of thousands of people gathered outside the parliament building and waved Lebanese flags in celebration.
Some of the demonstrators already marked the next target in their campaign, yelling "Lahoud, you are next," in reference to the country's president.
Druze opposition leader Walid Jumblatt, meanwhile, declared "the people have won."
"This is the first time in Lebanon's history that the government falls," one opposition member told the masses, who responded with anti-Syria calls.
See related opinion piece called Arabic Earthquake by Guy Bechor who is a Middle East affairs expert at the Interdisciplinary Center in Herzliya and a frequent contributor to the 'Yedioth Ahronoth' daily.
Victory for opposition
The Lebanese al-Mustaqbal television station, which was owned by Hariri, began broadcasting joyful music accompanied by live pictures from the main demonstration in Beirut's Martyrs Square.
The thousands of demonstrators protesting at the Square received the news of the resignation with cries of joy. The protestors have been at the square since early night hours, despite a protest ban declared by the Lebanese government.
The al-Arabiya network reported that several gunmen were seen at the demonstrations, but were later arrested by Lebanese army forces.
The government's resignation marks a clear victory for opposition forces in Lebanon, which have called for an investigation into the Hariri murder and for Syrian withdrawal from the country.
Lebanese opposition spokespersons said the government's decision is the first achievement en route to an inquiry into Hariri's assassination and the liberation of Lebanon from the Syrian occupation.
Opposition leaders, meanwhile, said the victory was insufficient and called on citizens to continue demonstrating in the streets until Syrian forces pull out of the country.
This is the first triumph in the struggle for freedom," one opposition speaker said at the Martyrs Square.
'This government is imaginary'
Earlier, opposition officials exchanged harsh words with outgoing Prime Minister Karami during the parliament session and claimed the government was not a sovereign one.
Parliament member and former Economy and Trade Minister Marwan Hamadeh, who survived an assassination attempt in October, delivered an unprecedented, harsh speech, which was aired on Arab television stations and stirred great interest.
"This government is imaginary and its members are imaginary," he said. "Hariri was killed back when they prevented him from being a prime minister and incited against him and claimed only money interested him."
"We will take this regime to court and I'm not scared to say this," Hamadeh added. "We demand to terminate the terms of all the security apparatuses' commanders in Lebanon.
He also said the problem did not lie with the Syrian army, but rather, with the Syrian intelligence service, which he said deploys agents "everywhere."
Meanwhile, U.S. Deputy Assistant Secretary of State David Satterfield met with the Lebanese Foreign Minister, and insisted on meeting opposition leaders as well.
In the meetings, Satterfield demand Lebanese and Syrian compliance with U.N. Security Council Resolution 1559, which calls on Damascus to withdraw its forces from Lebanon and disarm the HIzbullah.
-Reuters also contributed to this report