East Timor's president Xanana Gusmao will shortly begin the process of appointing a new leader to replace the ousted prime minister Mari Alkatiri.
President Gusmao has called a meeting of the council of states, an advisory body that will take on the task of finding a new prime minister.
The president will then consult widely before approving the appointment.
At least six people are seen as candidates for the job.
They include the former foreign minister, Jose Ramos-Horta, and his ex-wife Ana Pessoa, the minister of state.
Jose Luis Gutterres, East Timor's ambassador to the United Nations, has ruled himself out as a possible interim prime minister.
Announcing the decision to resign, Mr Alkatiri said he was putting the interests of East Timor first, and accepted his share of responsibility for the country's long-running crisis.
He had been under pressure to step down since violence erupted across the country in April.
The unrest came after Mr Alkatiri sacked about 600 soldiers who had complained of discrimination, triggering infighting among the security forces that spiralled into gang warfare.
- RADIO AUSTRALIA
East Timor prepares to appoint new prime minister
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