Carlo Cottarelli, a former International Monetary Fund official, follows in the footsteps of Mario Monti, who took over from Silvio Berlusconi after he resigned in 2011, before Enrico Letta, Matteo Renzi and Paolo Gentiloni all got the job thanks to political manoeuvres rather than success at the ballot box.
The BBC's James Reynolds in Rome says early elections are exactly what the two populist parties want, giving them a chance to rally support behind their claim that the Italian and the wider European establishments are getting in the way of the will of the people. Pro-Europe politicians and technocrats are relieved, for the populist victors in the March election, the Five Star Movement (M5S) and the League, certainly had no love for the European integration project or the common currency.
After meeting the president, Mr Cottarelli said he would present a programme to parliament. including a budget, to take Italy into new elections "at the beginning of 2019".
President Sergio Mattarella earlier summoned Carlo Cottarelli to his office after two anti-establishment parties angrily abandoned their plans to form a coalition in the face of a veto from the head of state over their choice of economy minister.
Voters could be headed to the polls again in a matter of weeks. The move further muddies the country's never exactly pristine political landscape. In March, 5-Star ran its own campaign while the League campaigned as part of a right-wing coalition with the party of former prime minister Silvio Berlusconi.
The leaders of Five Star and the League, Luigi Di Maio and Matteo Salvini, furiously denounced the veto, decrying what they called meddling by Germany, debt ratings agencies and financial lobbies.
Market nervousness is evident from a sharp spike in Italian bond yields, which in turn is weighing heavily on Italian assets and negatively impacting the sentiment.
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"The uncertainty over our position in the euro alarmed Italian and foreign investors who invested in shares and companies", Mattarella said.
Rome is burning. Italy's new populist government went up in flames only days before it was to be sworn in. He added that the League and 5-Star had refused to put forward any other name for the role.
The last one was filed in 2014 by the 5-Star Movement against Mattarella's predecessor, Giorgio Napolitano, but it was also rejected by the special committee.
"The only thing that is certain now is that there is a majority in parliament that can propose and approve laws, and the first thing we will do is start a discussion on a new electoral law", he said.
The Five Star's Di Maio demanded impeachment under article 90 of the constitution. Under that clause, parliament can seek to remove a president if a simple majority of lawmakers votes in favour.
The Constitutional Court proceedings are carried out according to its normal process, with hearings, debates and witnesses, and at the end the court hands down its decision, which can not be appealed.
"When you lose the desire to talk rationally about what's necessary in Europe today, and just consider the whole thing as something to be tossed out, you risk putting Italy in a situation from which it would be hard to recover", Galantino said.
As the votes come in, the ruling centre-left Democratic Party soon admits a "clear defeat".