Guinea-Bissau's President Jose Mario Vaz dismissed his two-day-old cabinet on Wednesday after the Supreme Court ruled that his appointment of a new prime minister was unconstitutional, a presidential decree said.
Vaz removed Guinea-Bissau's popular prime minister Domingos Simoes Pereira in August and replaced him with Baciro Dja, plunging the coup-prone nation into a political crisis.
Members of the ruling PAIGC party, to which all three men belong, objected to those decisions and appealed to the Supreme Court which found in their favour on Wednesday.
"The head of state can take no other approach than conforming with the decision of the supreme judicial authorities of the Republic," according to a note from the President's office released late on Wednesday.
Baciro Dja had announced his resignation on Wednesday but it was not immediately clear at the time if his cabinet - only appointed this week - would follow suit.
Deep-seated tensions between Vaz and Pereira have worsened since elections last year which restored democratic rule after a 2012 armycoup. The two men are former rivals for PAIGC leadership.
The former Portuguese colony has suffered nine coups or attempted coups since 1980 but the army has so far declared its neutrality in the current squabble.
Security sources say that resolving the current crisis and winning back the confidence of worried Western donors will depend on whether Vaz and senior members of the PAIGC leadership can agree on the next prime minister.
Party rules indicate that Pereira, who remains PAIGC president, should be reappointed - a plan likely to prove objectionable for Vaz.
In a statement made before hundreds of supporters, Pereira suggested that PAIGC leaders should take the initiative in resolving the crisis. "The PAIGC will know how to produce a solution to the political crisis," he said late on Wednesday.