Mr Berlusconi resigned to avoid a humiliating defeat on a vote of confidence and immediately called for a snap election, saying Italian voters "had been betrayed".
The Prime Minister, a media tycoon who entered politics barely a year ago, had been undermined by corruption allegations. He was eventually deserted by the Northern League, a key coalition partner.
The demand for new elections was backed by Italy's neo-fascist National Alliance. The head of state, President Oscar Luigi Scalfaro, now controls the political timetable. The Italian constitution does not oblige him to call elections if he is able to find a prime minister who can command a majority in the parliament.
Among the possible candidates were the Senate President, Carlo Scognamiglio, the former prime minister, Carlo Azeglio Ciampi, and Italy's European Commissioner, Mario Monti.
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