By Katie Stallard, Sky News Correspondent, in Kiev
Ukraine's prime minister has resigned, as the country's parliament voted to strike down controversial anti-protest laws.
The measures were forced through parliament two weeks ago, triggering a new wave of mass protests and violent clashes in which two activists were shot dead in front of police lines.
Opposition leader and former world heavyweight boxing champion said it was a "small, but important step".
In a statement posted on the government's website, Prime Minister Mykola Azarov insisted it was his personal decision to stand down "for the sake of peaceful resolution".
He said: "The conflict situation which has come about in the country is threatening the economic and social development of Ukraine, creating a threat to the whole of Ukrainian society and to each citizen.
"With the aim of creating extra means for finding a socio-political compromise, for the sake of a peaceful settlement of the conflict, I took the personal decision to ask the president to accept my resignation."
A cleric blesses anti-riot protest policemenIn reality, his position had become increasingly untenable after President Victor Yanukovich publicly offered the post to opposition leader Arseniy Yatseniuk on Saturday, along with a deputy prime ministerial job for Vitaly Klitschko.
Both Mr Yatseniuk and Mr Klitschko formally declined the posts today.
Mr Yatseniuk's Fatherland Party commented via twitter: "The resignation of the prime minister does not mean the resignation of the government."
Thousands of protesters gathered in Independence Square to watch the parliamentary vote on a big screen - all actions proscribed under the new laws.
They cheered as one after the other the measures were voted down.
Speaking outside parliament, Vitaly Klitschko said: "The positive thing is that we have revoked those shameful laws.
Vitaly Klitschko says the law changes are a start but more needs to be done"This is a small but a very important step. Today we also need to bring up a question, a very important question of amnesty to stop the prosecution of all the protesters. This is very important. It is also very important to go back to the question of returning to the constitutional amendment of 2004."
But few were moved by Azarov's offer of resignation, insisting that the president himself should stand down and call new presidential elections.
Azarov is deeply unpopular among protesters, whom he has referred to as "terrorists". He has accused the opposition of attempting to organise a coup d'etat.
The 66-year-old is considered a loyal lieutenant of President Yanukovich and a key figure in the government's decision not to sign an EU trade deal in November, which brought the first protesters to the the streets.
He has served as PM since 2010.
"All these difficult years I was doing everything so that Ukraine could develop normally as a democratic European country." he said. "I made decisions and took responsibility in the interests of the Ukrainian people.
Russian-speaking east Ukraine backs close ties with Russia"That's why I can honestly look in the eyes of each citizen of our country.
"I am grateful to all the citizens of Ukraine who supported the government and me personally, who believed - and still believe - that our political course is correct.
"The most important thing to do is to preserve the unity of Ukraine. This is so much more important than someone's personal plans and ambition."
Oleg Tsarev, a member of parliament for the ruling Party of Regions said: "I am very sorry about this, I think in this situation to change the cabinet will add economic instability to political instability - this is a wrong decision."
Parliament will vote later on a proposed amnesty for those detained in the protests, along with a commission to consider changing the constitution back to that of 2004, as it was following the Orange Revolution.
Today's parliamentary session is seen as the first substantive move towards resolving the crisis, and an indication the government is searching for a compromise.
The opposition said talks would continue, but vowed the protests would go on.
:: Watch Sky News live on television, on Sky channel 501, Virgin Media channel 602, Freeview channel 82 and Freesat channel 202.
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