Egyptian President Abdel Fattah al-Sisi on Saturday asked Oil Minister Sherif Ismail to form a new cabinet within one week after the government submitted its resignation, a statement from the presidency said.
It was not immediately clear why the government resigned but officials told Reuters on condition of anonymity that Sisi had been unhappy with the performance of several ministries.
The announcement comes almost one week after the authorities arrested Egypt's agriculture minister over corruption allegations.
Egypt is battling an insurgency headed by an affiliate of Islamic State while trying to attract more foreign investment in an economy reeling from years of turmoil that followed an uprising that toppled autocrat Hosni Mubarak in 2011.
Ismail will likely be appointed the new prime minister, replacing Ibrahim Mehleb. An engineer who held senior posts at several state-run energy firms, Ismail is seen as one of the best performing ministers.
As oil minister, he oversaw politically sensitive reforms, slashing energy subsidies, and also paid back some arrears to foreign energy companies to improve Egypt's image among investors.
Sisi has asked the previous government to carry on in a caretaker role until a new administration is formed, the statement said.
Egypt, the Arab world's most populous country, is due to hold long-delayed parliamentary elections next month, the final step in a process the government has said would deliver democracy.
In his former role as army chief, Sisi toppled Egypt's first freely-elected president, Islamist Mohamed Mursi, in 2013 after mass protests against his rule. Sisi was later elected president on promises of political stability and economic prosperity.
He launched a security crackdown that put an end to large-scale political unrest in Egypt but has drawn criticism from human rights groups who accuse him of silencing the opposition. (Additional reporting by Omar Fahmy; Writing by Michael Georgy; Editing by Raissa Kasolowsky)