Reports from Japan say the country's government has accepted finance minister Hirohisa Fujii's offer to resign because of his poor health.
A report from Kyodo News cited a source in the country's ruling party.
During talks earlier in the day, Prime Minister Yukio Hatoyama had asked Fujii to stay in the cabinet but he finally decided to accept the finance minister's resignation.
Fujii, 77, was admitted to hospital for tests last week and later said he was 'worn out' by wrangling over finalising Japan's budget.
The veteran lawmaker was picked by incoming premier Hatoyama in September to steer Asia's biggest economy out of its worst recession in decades, returning to a post he held briefly in the early 1990s.
Japan's economy returned to growth in the second quarter of 2009 after a severe year-long recession, but renewed deflation and weak domestic demand are major concerns for policymakers.
One of the few members of the current cabinet with previous government experience, he had planned to retire from politics but was persuaded by Hatoyama to stay on to pursue an agenda of slashing public sector waste.
A law graduate of the elite University of Tokyo, Fujii spent over 20 years with the finance ministry before turning his hand to politics, winning a seat in parliament for the first time in 1977.
His resignation would be another setback for Hatoyama, who has seen a sharp drop in his approval ratings since he took office in September, with polls indicating voters worry he lacks leadership.
