Health Minister Jillian Skinner has announced her retirement from politics ahead of a reshuffle in which the veteran Liberal MP was expected to be dumped from cabinet.
Mrs Skinner did not give a timeframe in her statement issued on Friday morning, but it is understood she will tender her resignation from the parliament next week, sparking a byelection in her seat of North Shore.
Fairfax Media understands Premier Gladys Berejiklian recently met with Mrs Skinner to discuss her reshuffle options but was told by her that "it's health or nothing".
The move is a blow for Ms Berejiklian who now faces at least two byelections within months - one in Mrs Skinner's seat and another in Manly following the retirement of her predecessor Mike Baird.
"I am deeply disappointed my friend, mentor and colleague Jillian Skinner has announced her retirement," Ms Berejiklian said.
In a statement, Mrs Skinner said: "I am naturally sad to be leaving the portfolio I love."
"However, a new chapter beckons and I am looking forward to the challenges of life outside politics."
Mrs Skinner has been in Parliament since 1994 and served as the opposition health spokeswoman for 14 years before being appointed minister after the 2011 election.
Ms Berejiklian was widely expected to dump Mrs Skinner from cabinet in the interests of renewal as part of a reshuffle designed to "refresh" the government for the 2019 election.
It has been suggested Mrs Skinner had threatened to cause a byelection should she be dumped.
Mrs Skinner was the target of fierce criticism over a series of health scandals in 2016, including the chemotherapy underdosing of more than 100 cancer patients by a St Vincent's Hospital oncologist and a gas mix-up at Lidcombe Bankstown Hospital that killed one newborn and left another severely brain damaged.
The opposition renewed their attacks after two babies were mistakenly cremated, and a body bag mislabelled at Royal North Shore Hospital. A series of legionella outbreaks across Sydney, and reports some hospital emergency departments were at breaking point intensified calls for her head to roll.
However, Ms Berejiklian said that, as health minister, Mrs Skinner "has delivered major improvements in health services and overseen the largest expansion in health infrastructure in the state's history".
"I wish Jillian and her family well for the future and know that she will be sorely missed by so many across the entire health system," she said.
More to come.