Socialist leader Pedro Sanchez has taken over as Spain's prime minister after parliament toppled his predecessor Mariano Rajoy in a no-confidence vote triggered by a corruption scandal involving members of his centre-right party.
Lawmakers stood and cheered as Sanchez - who had earlier promised to try to steer the country through to mid-2020 when the parliamentary term ends - became the country's seventh head of government since its return to democracy in the late 1970s.
But Rajoy's departure after six years in office casts one of the euro zone's top four economies into an uncertain political landscape, just as another - Italy - pulled back from early elections.
Sanchez won Friday's no-confidence motion by 180 votes to 169, with one abstention.
The 46-year-old's Socialist party holds just 84 seats in the 350-member assembly, making it unclear how long his administration can last.
But his strong pro-European credentials, and the fact that Rajoy also ran a minority government, suggest fallout from any political ructions in one of the euro zone's fast-growing economies is likely to be limited.
Spain's stock market rose after the parliamentary vote, to trade nearly 2 per cent higher on Thursday's close, while the country's borrowing costs fell.
"Sanchez has reiterated a commitment with European orthodoxy and budget control in Spain," UBS analysts said. "We do not anticipate a substantial impact on the pace of growth."
With most other Spanish parties also pro-European in outlook, Sanchez has already committed to respecting a fiscally conservative budget passed by Rajoy.
The fragmented parliament means he will also find it hard to row back on structural reforms passed by his predecessor, including new labour laws and cuts in healthcare and education.
Leftist party Podemos has promised to support Sanchez in parliament, though it seems unlikely to gain major influence over Sanchez, who is keen to win back centrist voters.
The outgoing premier conceded defeat prior to the no-confidence vote, congratulating Sanchez and telling deputies in a short, gracious speech: "It has been an honour to have left Spain in a better state than I found it."
The 63-year-old stalwart of the centre-right People's Party (PP) took over the government in 2011 in the middle of a deep recession and presided over a dramatic economic recovery.
However, his position had become increasingly untenable, undermined by scandals encircling his party as well as a divisive independence drive in the wealthy region of Catalonia, which led Madrid to impose direct rule on the region last autumn.
The no-confidence motion was brought by Sanchez after a judge sentenced dozens of people linked to the PP to decades in jail in a long-running corruption trial.
Sanchez, who is expected to be sworn in by Monday and appoint his cabinet next week, has promised to start talks with the Catalans but has said he will not give the region an independence referendum.
