"Out of concern that the government does not become an obstacle to the good of the country, I announce the resignation of the government I had the honour to lead," Karami told parliament in Beirut on Monday.
The resignation, which was accepted by Lebanese President Emile Lahud, followed massive public protests in the wake of former premier Rafiq al-Hariri's assassination February 14.
Karameh's cabinet took office after Hariri, a five-time prime minister and billionaire businessman, resigned in October in a row over Syrian influence in his country.
The announcement was greeted with loud applause in the national assembly, where the opposition was seeking a vote of no confidence to bring down the government.
However, opposition figures continued calling for popular protests to continue until Syrian troops leave the country.
"The battle is long, and this is the first step, this is the battle for freedom, sovereignty and independence," said opposition MP Ghattas Khouri.
Tens of thousands of demonstrators who defied a ban to gather at the nearby Martyrs Square, broke into singing the national anthem on hearing the news.
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