A Supreme Court sympathetic to President Maduro has basically annulled the National Assembly where the opposition holds majority.
Opposition leaders branded Venezuela's socialist President Nicolas Maduro a "dictator" on Thursday after the Supreme Court took over the functions of Congress.
There was widespread international condemnation of the de facto annulment of the National Assembly.
Opposition won a majority in the assembly in late 2015 amid an unprecedented economic crisis that has seen Maduro's popularity plummet.
The head of the 34-nation Organization of International States (OAS), Luis Almagro, said the Venezuelan court had dealt the final blows to democracy and accused Maduro's "regime" of carrying out a "coup."
Brazil, Argentina, Mexico, Colombia, Chile, Guatemala and Panama expressed strong concerns while Peru withdrew its envoy after what it termed a rupture of democracy.
The United States described the move as a "serious setback for democracy in Venezuela," while the European Union called for a "clear electoral calendar" going forward.
Venezuela's top court has overturned most National Assembly decisions since the opposition win.
Then late on Wednesday, it explicitly stated it was assuming Congress' role in a ruling authorising Maduro to create oil joint ventures without the previously mandated congressional approval.
TRT World's Nafisa Latic reports.
Critics of Maduro say it is an excuse for him to consolidate power and muzzle the opposition amid a severe recession, soaring inflation and acute shortages of food and medicine.
Maduro, a 54-year-old former bus driver and foreign minister, was narrowly elected in 2013 to replace late leftist President Hugo Chavez.
His term in office ends in January 2019.
He has accused Washington of leading a push to topple him as part of a wider offensive against leftist governments.
Leaders of Venezuela's Democratic Unity opposition coalition renewed their demand for early presidential elections.
Soon after the decision, pockets of youths took to the streets in parts of Caracas and attempted to block a major highway.
However, numbers were small and they quickly dispersed.