The minority government formed exclusively from Mrs Ciller's conservative True Path Party was defeated by 230 votes to 191.
Mrs Ciller looked crestfallen as her plans foundered on the loss of 13 votes from her party and a hoped-for 10 votes from the former prime minister, Bulent Ecevit, lost when she failed to make a deal with 350,000 striking public sector workers.
But Mrs Ciller, 49, willed her trademark ''iron smile'' back and bounced up to the rostrum to make sure everyone understood that she was not going to surrender easily to the ad-hoc alliance that ganged up on her.
"Let everybody know that no government can come from this parliament without the True Path Party," said Mrs Ciller, who can count on about 170 votes in parliament. "The democratic solution now is to go quickly to early elections."
Elections are due before next October, but probably would take more than two months to organise. More than 4 million voters must be added to the rolls inside Turkey after a lowering of the voting age to 18. Key election laws also have not been passed yet.
Mrs Ciller's election plans may be tripped up by those in her own party plotting her downfall. Five senior backbenchers who lost out on the cabinet seat lottery resigned last week, and another eight voted against her yesterday. Most cunning is Husamettin Cindoruk, 62, a perennial also-ran of Turkish politics who resigned as Speaker on 1 October to be available "to do his duty".
According to the most likely scenario, President Suleyman Demirel will end up offering the opportunity to form a government to Mr Cindoruk as an "independent". Behind the scenes politicking has mapped out a coalition including the far right, Islamists, the social democrats, the centre-right and the leftists.
Such plans, however, depend on winning over the bulk of the True Path Party and may meet their match in Mrs Ciller's determination to stay in politics. Almost all True Path deputies stood on their feet to clap and cheer Mrs Ciller. They gave no sign of believing that anybody else would help win them more votes in the next elections.
The big losers were the public sector strikers, who staged a noisy rally down Ataturk Boulevard in support of their three-week-old action in railways, ports and sugar factories. Their leaders' brinkmanship had failed to force Mrs Ciller to abandon spending limits under an IMF-imposed austerity plan, and now they have no government to negotiate with.
More worrying is that deepening political uncertainty in Turkey is endangering a free trade deal with Europe. The European Parliament, which votes on ratifying customs union on 14 December, has demanded human rights reforms. But Turkey's internal bickering seems likely to hamstring this.