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France's far-right and left-wing lawmakers have joined together to vote a no-confidence motion prompted by budget disputes that forces Prime Minister Michel Barnier to resign.
The National Assembly approved the motion by 331 votes. A minimum of 288 were needed.
President Emmanuel Macron insisted he will serve the rest of his term until 2027.
However, he will need to appoint a new prime minister for the second time after July's legislative elections led to a deeply divided parliament.
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Barnier on Monday invoked a rarely used constitutional mechanism to push through the contentious 2025 budget without parliamentary approval, arguing it was essential to maintain "stability" amid deep political divisions.
The move immediately drew sharp backlash, with Marine Le Pen's far-right National Rally and the leftist New Popular Front both filing no-confidence motions in response, setting the stage for the vote that ousted the prime minister.
Macron had turned to Barnier in September to navigate the impasse and address France's soaring deficit.
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Yet Barnier's proposed austerity budget — slashing €40 billion ($65.37 billion) in spending and raising taxes by €20 billion ($32.68 billion) — has only deepened divisions, inflaming tensions in the lower house and triggering this dramatic political confrontation.
The use of the constitutional tool, called Article 49.3, allows the government to pass legislation without a parliamentary vote but leaves it exposed to no-confidence motions.
Opposition leaders argued that Barnier's concessions, including scrapping an electricity tax hike, do not go far enough to address their concerns. Le Pen accused Barnier of ignoring her party's demands.
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"Everyone must shoulder their responsibilities," she said.
The political standoff has unsettled financial markets, with borrowing costs rising sharply amid fears of prolonged instability.
Barnier warned of "serious turbulence" if the budget isn't passed, but critics dismissed his remarks as fear-mongering.
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