Jordanian Prime Minister Hani Mulki resigned on Monday in wake of popular rallies protesting price hikes.
"Prime Minister Hani Mulki submitted his resignation to the king this afternoon during a meeting at the Husseiniyeh Palace and the king accepted the resignation," a government source told AFP.
The king asked Education Minister Omar al-Razzaz to form a new government, the source added.
Mulki was summoned by King Abdullah II after the capital Amman and several other cities were rocked by demonstrations that drew thousands of people.
Jordan has seen prices of several basic goods and services like bread, fuel and electricity steadily rise over the past year.
The rallying cries by demonstrators for Mulki to step down came after the government adopted a draft income tax law and announced new price hikes based on recommendations by the International Monetary Fund.
The premier's meeting with the king came hours after around 5,000 people gathered outside Mulki's office in Amman, on the fifth consecutive day of protests.
"The tax bill will continue to hound the new government, whatever its policy, until the law is thrown out," said Jordanian political analyst Adel Mahmoud.
"The new prime minister will face a number of strategic factors in dealing with the unprecedented street protests, the most important of which is to... open convincing channels of dialogue," he told AFP.
Security officials said Monday 60 people had been detained since the protests began.
"There are some irresponsible groups who left protests to cause violence, destroy property and assault police, which is unacceptable," said Major General Hussein al-Hawatmeh.
The IMF loan, intended to support economic and financial reforms, has the long-term objective of reducing Jordan's public debt from about 94 percent of GDP to 77 percent by 2021.
