After months of speculation, former Prime Minister and Foreign Minister Kevin Rudd announced his resignation in a surprise press conference.
Kevin Rudd's resignation from his cabinet position as Foreign Minister, and move to the backbench, was made without first notifying Prime Minister Julia Gillard.
The former PM called a late-night press conference from Washington DC to announce his decision, leaving open the possibility of launching a leadership challenge from the backbench.
Ms Gillard then called the leadership spill for February 27 to vote in a caucus ballot, hoping to finally resolve the turmoil in the Labor Party.
The Prime Minister won a landslide victory against Rudd, with a decisive vote of 71 to 31 in her favour.
The victory came despite data from Newspoll that revealed Mr Rudd was the preferred Prime Minister: 53 per cent to Ms Gillard's 28 per cent.
Ms Gillard made a surprise pick of former New South Wales Premier Bob Carr to replace Mr Rudd's position as Foreign Minister.
The appointment of Mr Carr to the role fulfilled a long-time ambition of the former New South Wales Premier. He replaced Mark Arbib in the Senate, following Mr Arbib's resignation in the aftermath of the leadership spill.