Sweden looks set to have a new prime minister, or a snap election, after the country's parliament backed a motion of no-confidence in the current incumbent Stefan Lofven.

The vote means the Social Democrat leader has a week to either resign, or call an election.

(Photo: agencies)

The vote was called by the nationalist Sweden Democrats who seized their chance to bring down the ruling coalition after the Left Party withdrew its support over a plan to ease rent controls.

Lofven's coalition with the Green Party had survived with support in parliament from two small center-right parties and the Left Party since 2018.

If Lofven resigns, the parliamentary math makes it difficult to see who could get enough votes to form an alternative administration, which means a general election is seen as likely. The next election is due in September 2022.

It is the first time a Swedish prime minister has been ousted by a no-confidence motion put forward by the opposition.