Lithuanian Prime Minister Algirdas Brazauskas and his government formally resigned on Thursday, said reports reaching here from Vilnius, capital of Lithuania.
The resignation came after the largest party in the government -- the Labor Party -- left the coalition over allegations of mishandling state and party funds.
Brazausksas said on Wednesday he does not see any possibility of keeping his post and so he decided to resign with his cabinet.
Brazauskas is the leader of the Social Democrats party, the No. 2 party in the government. He has led two successive governments since 2001.
The outgoing prime minister said his resignation would take effect immediately, while prime ministers in the country usually stay until a successor takes office.
President Valdas Adamkus is expected to name Finance Minister Zigmantas Balcytis as acting prime minister later Thursday.