Tantawi was replaced by Abdel Fattah al-Sissi, while the head of the armed forces, Sami Anan, was also ordered to retire with immediate affect, according to a presidential spokesman.

In addition, Islamist Morsi cancelled a constitutional declaration issued by the then-ruling army council in June, just before the military handed power to Morsi. The declaration had given the army sweeping powers.

Morsi also appointed Mahmoud Mekki, a former judge, as vice president.

Tantawi was a minister under ousted Egyptian leader Hosni Mubarak for 20 years. When Mubarak was toppled, Tantawi's Supreme Council of the Armed Forces (SCAF) effectively ruled the country until Morsi was elected.

It is not clear whether Tantawi and Anan were consulted before being sent into retirement.

"Given the circumstances, this is the right time to make changes in the military institution," said Mourad Ali from the Muslim Brotherhood-affiliated Freedom and Justice Party.

Morsi's Muslim Brotherhood has been at odds with the military after it retook control over parliament following a court decision to dissolve the legislature, where Islamists have a majority.

ng/msh (Reuters, dpa, AFP)