The chancellor and health secretary have resigned from government, saying they no longer have confidence in Boris Johnson to lead the country.
Chancellor Rishi Sunak said the public expected government to be conducted "properly, competently and seriously".
Health Secretary Sajid Javid echoed this, saying the government was not "acting in the national interest".
The resignations came minutes after the PM apologised for appointing MP Chris Pincher to a government role.
Education Secretary Nadhim Zahawi has been named as the new chancellor, and Downing Street chief of staff, Steve Barclay, will replace Mr Javid as health secretary.
Higher education minister Michelle Donelan has been promoted to education secretary.
Mr Johnson admitted he had made a "bad mistake" in appointing Mr Pincher to the role of deputy chief whip earlier this year, despite being made aware of earlier allegations about the MP's conduct.
In an interview with the BBC, Mr Johnson said: "In hindsight it was the wrong thing to do. I apologise to everybody who has been badly affected by it."
His handling of the row has faced fierce criticism from the opposition and some of his own MPs.
Alongside Mr Sunak and Mr Javid, Bim Afolami quit as Tory vice-chair live on TV, Andrew Murrison resigned as a trade envoy, and ministerial aides Jonathan Gullis and Saqib Bhatti left their roles.
But the BBC understands Foreign Secretary Liz Truss, Levelling Up Secretary Michael Gove and other cabinet ministers are backing the prime minister as he assesses the scale of the rebellion against his leadership.
Mr Johnson has been publicly backed by loyal allies Culture Secretary Nadine Dorries and minister for Brexit Opportunities Jacob Rees-Mogg, who insisted the prime minister was the "right man for the job".
The resignation of two senior cabinet ministers has plunged Mr Johnson into a fresh leadership crisis weeks after he survived a no-confidence vote.
The PM is immune from a Conservative leadership challenge until June next year under party rules, after he won 59% of the vote.
In response to the resignations, Labour leader Sir Keir Starmer said he would welcome a snap election and the country needed a change of government.
He said: "After all the sleaze, all the failure, it's clear that this Tory government is now collapsing."
The next general election is expected to be held in 2024 but could be earlier if Mr Johnson used his powers to call one.
The leader of the Liberal Democrats, Sir Ed Davey, said the prime minister's "government of chaos has failed our country", and called for him to go.
Scottish First Minister and SNP leader Nicola Sturgeon said "the whole rotten lot" in Mr Johnson's government should go, accusing ministers of "lying to public".
Is this the beginning of the end for Boris Johnson?
During the course of the day, some of the PM's prominent critics called on government ministers to put pressure on the prime minister to resign.
A chancellor, Rishi Sunak, and an ex-chancellor, Sajid Javid, have done just that.
Both men see their resignations as necessary if the PM is to be pushed out.
Both may be positioning for a future leadership contest.
But even now, Downing Street will hope to avoid this.
Boris Johnson still has his foreign secretary, home secretary, defence secretary and business secretary.
And, remember, a beleaguered Gordon Brown survived a ministerial resignation because the rest of his cabinet stayed loyal, when he was in Number 10.
But it now seems more likely that other ministers, in more junior roles, who have been privately critical of Boris Johnson could follow Mr Sunak and Mr Javid's lead.
The last Conservative prime minister to face a party vote on their leadership was Theresa May, who won the vote but resigned six months later over her approach to Brexit.
Mr Johnson's government has been dogged by a series of controversies in recent months, prompting some Tory MPs to call for the prime minister's resignation.
Discontent among Tory MPs has grown since a highly critical report into lockdown parties in and near Downing Street during the Covid-19 pandemic was published earlier this year.
The report laid bare the extent of Covid rule-breaking in Number 10, including at a birthday party for which the PM was fined by the police.
The fine meant Mr Johnson became the UK's first serving prime minister to be sanctioned for breaking the law.
Some Tory MPs have also expressed dissent over tax rises, the government's response to rising living costs and its policy direction.
In a dramatic sequence of events on Tuesday evening, Mr Javid shared his resignation letter on Twitter shortly after 18:00 BST - minutes after the prime minister spoke to reporters in Downing Street.
Mr Javid - who has been health secretary since June 2021 - said he could "no longer in good conscience continue serving in this government".
"I am instinctively a team player but the British people also rightly expect integrity from their government," he wrote.
"The tone you set as a leader and the values you represent, reflect on your colleagues, your party and ultimately the country."
A few minutes later at about 18:10, Mr Sunak tweeted out his resignation letter, leaving two top roles empty in Mr Johnson's cabinet.
In his letter, Mr Sunak, who has been tipped as potential future leader of the Conservative Party, told the prime minister that standards in government were "worth fighting for".
Since becoming chancellor in February 2020, Mr Sunak has not always been in sync with the prime minister on economic policy and public spending.
"I have been loyal to you," Mr Sunak wrote in his letter. "I backed you to become leader of our party and encouraged others to do so.
"I have served as your chancellor with gratitude that you entrusted me with stewardship of the nation's economy and finances."
But Mr Sunak said that he could no longer back Mr Johnson, suggesting their differences could not be reconciled.
He said: "In preparation for our proposed joint speech on the economy next week, it has become clear to me that our approaches are fundamentally too different.
"I am sad to be leaving government but I have reluctantly come to the conclusion that we cannot continue like this."