The resignation of Yasuo Fukuda, 72, deepened a two-year stretch of political instability at the helm of the world's second-largest economy. It came only days after the government announced a stimulus package to counter flagging consumer spending.
Fukuda, who took office just less a year ago, said he was clearing the decks for a more popular successor to take over ahead of a tough special session in the parliament, where the ruling party controls the lower house and the opposition dominates the upper.
"We still have time before discussion of key policies starts in the upcoming parliamentary session, and this is the perfect timing not to cause people too much trouble," Fukuda said, explaining that he was exiting to avoid a "political vacuum."
Fukuda suffered throughout his term from anemic public backing the latest poll showed him with only 29 percent support and repeated embarrassment at the hands of the obstructionist opposition in parliament.
The resignation announcement came a month after Fukuda installed his most widely expected successor, former Foreign Minister Taro Aso, as secretary general of the Liberal Democratic Party, in a Cabinet shake-up aimed at boosting support for the government. Aso, who lost against Fukuda in the race for premier last year, has not said whether he would run again.
The resignation, which will probably not take effect for a couple of weeks, surprised Japan and was solidly condemned by the opposition as a sign of deep instability within the LDP, which has ruled the country almost without interruption since 1955.
"It's just incredible that the LDP is getting rid of Fukuda and he is actually quitting ... without thinking of the people at all," said opposition Social Democratic Party leader Mizuho Fukushima.
The opposition, which took control of the upper house in elections last year, has pushed for snap elections for the more powerful lower house, but the LDP aware that it would likely lose seats has so far resisted. Fukuda's sudden resignation, however, could be a sign the LDP is rushing to put a fresh leader in place before calling a snap ballot.
The resignation prolonged the political uncertainty that has plagued Japan since the popular Junichiro Koizumi left the premiership in 2006 after five years in office.
Koizumi's hand-picked successor, Shinzo Abe, lasted only a year in office, resigning in September 2007 for health reasons. Fukuda had been considered a steady elder who would lend stability to the office, but he was never able to overcome divisions in parliament.
The opposition, led by the Democratic Party of Japan, repeatedly delayed Fukuda's most closely watched legislative initiatives in parliament, such as the renewal of Japan's anti-terror mission in the Indian Ocean and the selection of a new central bank governor.
Looming economic problems have also troubled the government in recent months. The economy shrank sharply in the second quarter, effectively ending the expansion that began under Koizumi.
Fukuda alluded to his lack of popularity in his speech Monday. He suffered throughout his term from a dowdy image a new political liability in a country that had grown accustomed to Koizumi's flash.
"You may say it's irresponsible for me to resign at this time. Well, it would be good if parliamentary proceedings went smoothly if I stayed on, but in my case, I also had support ratings, along with various other problems," Fukuda said.
Fukuda's sudden exit, however, could play into the hands of the opposition, which many voters had feared until now was not ready to assume power. The instability, however, may erode the LDP's argument that it is the only party fit to lead.
"The DPJ smells blood they already have their campaign manifesto: the LDP is irresponsible," said Jeffrey Kingston, a political specialist at Temple University in Tokyo.
For Japan's bewildered voters, the latest moves were just more proof that there's something deeply wrong with the country's politics.
Tarotoshi Yaomura, a 30-year-old hotel worker, said he was mildly surprised by the resignation, but had more or less lost hope that the political elite could provide much leadership.
"I'm not expecting much from the successor," he said outside of Tokyo's busy Shimbashi station. "I'm more excited about Obama in the U.S."
The White House said Monday that U.S. President George W. Bush was pleased to have worked closely with Fukuda during his time in office.