Sajid Javid has been appointed as British Home Secretary following the resignation of Amber Rudd amid claims she misled parliament over targets for removing illegal migrants.
Ms Rudd telephoned British Prime Minister Theresa May last night to tell her of the decision amid intensifying opposition demands for her to quit.
A government spokesman said: "The Prime Minister has accepted the resignation of the Home Secretary."
Mr Javid, 48, a former managing director at Deutsche Bank and the son of a Pakastani bus driver, was previously Communities and Local Government Secretary.
He was replaced as Secretary of State for Housing, Communities and Local Government by former Northern Ireland secretary James Brokenshire, who has recently returned to Westminster after treatment for cancer.
International Development Secretary Penny Mordaunt takes on Ms Rudd's former responsibilities as Minister for Women and Equalities.
Ms Rudd was thought to be preparing to tough it out, insisting she genuinely did not know about the targets when she gave evidence to a House of Commons committee last week.
However, having seen mounting evidence in the paperwork about the extent of the knowledge within the Home Office about the targets she decided that she should take responsibility and resign.
Her decision to stand down will come as a major blow to Mrs May who publicly declared her "full confidence" in her as recently as Friday.
Even before she was accused of misleading MPs, Ms Rudd had been under fire for her handling of the Windrush scandal, which saw Commonwealth citizens who came to Britain in the post-war decades being wrongly threatened with deportation.
Labour said she was effectively acting as a "human shield" for Mrs May, whose policy of creating a "hostile environment" for illegal immigrants when she was home secretary was blamed for causing the problems they now faced.
Shadow home secretary Diane Abbott said: "After this scandal and its botched cover up, Amber Rudd's resignation was inevitable. It should have come sooner.
"The architect of this crisis, Theresa May, must now step forward to give an immediate, full and honest account of how this inexcusable situation happened on her watch."
Liberal Democrat home affairs spokesman Ed Davey said: "It's clear that Amber Rudd has ended up, at least partly, being the fall guy to protect the Prime Minister.
"Theresa May must face questions now given these dreadful failures largely took place under her watch as home secretary."
Ms Rudd's departure will also upset the delicate balance within the cabinet between Leavers and Remainers ahead of a crucial meeting of the Brexit cabinet committee on Wednesday to discuss Britain's future customs relationship with the EU.
Environment Secretary Michael Gove, who is one of the cabinet's leading Brexiteers, was being touted as the front runner replace Ms Rudd at the Home Office.
