In a major move to dismantle the vestiges of the Mubarak era, Egypt's military on Sunday dissolved the Parliament and suspended the country's constitution, accepting the major demands of the protesters.
The Supreme Military Council, that took over the reins of the administration after Hosni Mubarak bowed out under public pressure ending his 30-year reign, said it would stay in power for six months or until the elections are held to determine the next government of Egypt.
It also fixed a September date for elections that will eventually decide the country's next government.
The move to dissolve the parliament that is comprised mostly of Mubarak loyalists along with the suspension of the constitution meets two major demands of the demonstrators camping at the Tahrir Square since 20 days.
The parliament that was elected last year had a majority of members of the National Democratic Party of Mubarak and was regarded as illegitimate by many people as widespread rigging was believed to have led to the ruling party's overwhelming victory and the opposition's wipe out.
In a communique read out on national television, the military council also announced that it would constitute a panel to amend the constitution to meet the demands of reform by the people, before submitting the changes to a popular referendum.
Sunday's steps are the first major measures to remove the Mubarak-era relics of power after the erstwhile regime was overturned by a mass uprising.
The caretaker military government had on Saturday promised to oversee a peaceful transition to democracy but many protesters had said they wanted to see more concrete measures before they can return to their daily life.
In fact, the Army, which tried to clear the Tahrir Square on Sunday morning, was met with resistance, with many protesters choosing to stay put until further guarantees from the new leadership.
Meanwhile, Prime Minister Ahmed Shafiq said that his government's first priority was to restore peace and normalcy to the country which has witnessed dramatic events over the past fortnight.
"Our main concern now as a cabinet is security -- we need to bring back a sense of security to the Egyptian citizen," he said.
He said the country's financial position was "solid and cohesive" but cautioned that the present instability should not continue. Shafiq also pledged to "return rights to the people and
Don't leave Egypt, army tells Mubarak's aides
Egypt's Muslim Brotherhood to join crisis talks
Egyptian President Hosni Mubarak resigns
Egypt crisis: Mubarak forms reforms panel
Egypt govt, opposition agree on reform committee