Russian President Dmitry Medvedev has fired Moscow's powerful mayor, Yuri Luzhkov.
Mr Luzhkov, 74, was being removed because he had lost "the trust of the president of the Russian Federation", a presidential decree said.
In recent weeks Mr Luzhkov - who has been in office since 1992 - had faced harsh criticism from the Kremlin.
Mr Luzhkov accused opponents of mounting a concerted campaign "of lies and slander".
Mr Luzhkov is one of Russia's most powerful politicians and is a senior member of the pro-Kremlin United Russia party - but he complained of being abandoned by the party.
Recently, being one of the party's leaders, I have been fiercely attacked by state mass media, and the attacks were related to the attempts to push Moscow's mayor off the political scene," Mr Luzhkov said in a resignation letter to the party.
He said he felt the party "did not provide any support, did not want to sort things out and stop the flow of lies and slander".
As the president of Russia I lost my trust in Yuri Mikhailovich Luzhkov as the mayor of Moscow," Mr Medvedev told journalists during a visit to China.
"I will decide who will lead Moscow."
However, Vladimir Putin suggested he would influence the decision, saying: "I hope I will have a chance to express my opinion."
Mr Putin praised the former mayor as "a symbolic figure in modern Russia".
But he backed the president's announcement, saying: "It is completely clear that the mayor's relations with the president didn't work out The mayor is the president's subordinate and not the other way around - therefore steps had to be taken to resolve the situation."
Before the emergence of Mr Putin a decade ago, Mr Luzhkov was even tipped as a possible future president.
However he was recently the subject of a constant barrage from state-run TV, which criticised him for gridlock on the capital's roads and bulldozing historic buildings.
During this summer's forest fire crisis, when Moscow was choked by smoke and baked in record high temperatures, he was attacked for remaining on holiday.
Mr Luzhkov and his billionaire wife, Yelena Baturina, have been also accused of corruption.
Mr Luzhkov has denounced all the claims as "total rubbish", designed to make him "lose his balance". He has threatened to sue the TV channels concerned.
Commentators believe this battle at the highest level of Russian politics was sparked by a newspaper article written by the mayor in which he appeared to criticise the president and call for a return to stronger national leadership, says the BBC's Richard Galpin in Moscow.
The Kremlin clearly decided Mr Luzhkov had to be pressurised to resign voluntarily or be pushed out, our correspondent says.
On Monday, after returning from a week's holiday in Austria, Mr Luzhkov said he would not stand down voluntarily.
Mr Medvedev then acted. He is entitled, under the constitution, to fire the Moscow mayor and regional governors, and appoint successors without popular elections.