Boris Johnson is to stand down as Conservative leader, but intends to carry on as prime minister until the autumn.
He is expected to make a resignation statement in Downing Street shortly.
It follows a dramatic 48 hours which saw dozens of ministers – including chancellor Rishi Sunak – resigning in protest at his leadership.
Mr Sunak’s replacement as chancellor Nahim Zahawi was among the ministers urging the PM to quit.
He resisted the calls until Thursday morning, when it became clear that he had lost the confidence of his MPs and that the government could no longer function.
Less than three years ago, Mr Johnson won an historic landslide victory in a general election – but he has been dogged by controversy in recent months, including a fine for breaking his own lockdown laws.
The revolt this week was triggered by revelations about the prime minister’s handling of sexual misconduct allegations against former Deputy Chief Whip Chris Pincher.
BBC political editor Chris Mason said Graham Brady, the chairman of the 1922 Committee of backbench Tory MPs, has met the prime minister to tell him he has lost the confidence of the party.
Labour leader Sir Keir Starmer said the prime minister’s resignation was “good news for the country” but “should have happened long ago”.
Sir Keir accused the prime minister of “lies, scandal and fraud on an industrial scale” and said “those who have been complicit should be utterly ashamed”.