The country's lawmakers voted 43-11 in favour of the motion against PM Krivokapić following weeks of political bickering between the coalition partners.
Montenegro's governing coalition collapsed on Friday night amid internal disputes after parliament backed a no-confidence motion tabled by a junior coalition partner.
The 81-strong assembly voted 43-11 in favour of the motion against Prime Minister Zdravko Krivokapić and his cabinet following weeks of political bickering.
Some lawmakers, including those from the right-wing populist DF — who were a part of the ruling coalition — either abstained or left the session before the vote after an all-day discussion.
Tensions flared as well, with verbal insults and disagreements forcing the parliament peaker Aleksa Bečić to issue reprimands and call for breaks to calm the tensions prior to the vote.
Friday's vote came barely one year after the coalition came to power, replacing the long-ruling Democratic Party of Socialists (DPS).
Coalition partners were at odds over several issues, including a stalled EU accession process and the influence of the Serbian Orthodox Church in Montenegro's domestic affairs.
On 19 January, deputy PM and the leader of the United Reform Action (URA) party Dritan Abazović filed a motion for a vote of no confidence against Krivokapić and the rest of the government.
Krivokapić responded by demanding a vote of no confidence against Abazović, as well as a motion to prematurely dissolve the parliament, which would trigger a snap election.
The two demands by Krivokapić failed to make the parliament's agenda at a session on Thursday, indicating that the prime minister had lost the faith of the country's lawmakers.
Following the session, Abazović, who proposed an interim minority government that would keep DPS out again, said an election should be held "as soon as possible" if a government could not be formed.
"The goal is that Montenegro comes out of the blockade and forms a government as soon as possible… The worst possible thing is what is happening now, and that is uncertainty."
Consultations amongst potential coalition members of the new government were already announced for Saturday.
Krikokapić, a university professor who rose to prominence during a series of protests led by the Serbian Orthodox Church to protect its property interests, headed an ideologically-mixed coalition that included pro-Serbian nationalists as well as smaller liberal and minority parties.