Update 6.10pm - May formally appointed Conservative Party leader
Theresa May will take the keys to No 10 by Wednesday evening, David Cameron has confirmed.
The current Home Secretary was officially appointed Conservative Party leader this afternoon, with party committee chairman Graham Brady saying she was the party's new leader "with immediate effect".
Prime Minister Cameron said he was "delighted" that May would succeed him in Downing Street and he will go to the Palace to offer his resignation to the Queen on Wednesday afternoon.
Cameron will chair his last Cabinet meeting tomorrow morning and appear in the Commons for the final time as premier when he takes to the Despatch Box for Prime Minister's Questions at noon on Wednesday.
"It is clear Theresa May has the overwhelming support of the Conservative parliamentary party," Cameron said, adding that May was "strong, she is competent, she’s more than able to provide the leadership the country is going to need in the years ahead and she will have my full support."
May became the last candidate standing in the race to the Tory leadership earlier today following the surprise withdrawal of her only rival in the battle to succeed Cameron as Tory leader and UK Prime Minister.
Energy Minister Andrea Leadsom offered Mrs May her "full support" after conceding that she had too little support among Tory MPs to deliver a "strong and stable government".
And, crucially, the figureheads of the Brexit campaign in last month's referendum, Michael Gove and Boris Johnson, offered the Home Secretary their backing as new Conservative leader.
The chairman of the Conservative 1922 Committee, Graham Brady - who oversees Tory leadership contests - said he had to consult the party's board before formally confirming Mrs May as new leader. But he made clear that there was no need to re-start the election, and there was no doubt at Westminster that it was simply a matter of time before she becomes Prime Minister.
The handover of power to a new prime minister had not been expected to take place until after the conclusion of the ballot of 150,000 Conservative members on September.
May was immediately put on the alert by rival party spokespeople.
Labour election coordinator Jon Trickett said he was putting the whole party on general election footing, on the very day when its own leadership contest was kicked off by a formal challenge to Jeremy Corbyn from Angela Eagle.
And the Liberal Democrats and Greens demanded an early election following Mrs May's "coronation".
Mr Brady said that both Downing Street and Buckingham Palace had been "properly consulted and involved" in the process.
In a statement accepting that Mrs May has effectively been chosen as Tory leader, the Home Secretary's campaign manager, Chris Grayling, said she was "enormously honoured to have been entrusted with this task".
Mrs May, who launched her national campaign with a speech in Birmingham just moments before Mrs Leadsom's withdrawal, was travelling back to London to make a statement.
"Theresa will do everything she can to equip our country for the challenges that lie ahead," said Mr Grayling.
Mrs Leadsom announced that she was quitting the contest shortly after apologising to Mrs May over an interview in which she appeared to suggest that the fact she was a mother gave her the edge over the childless Home Secretary as a future PM.
Some supporters suggested she had been targeted for attack, after a string of high-profile media stories questioning the accuracy of her CV and demanding that she release her tax returns.
Conservative MP Heather Wheeler said Mrs Leadsom had been the victim of a "sledging", telling BBC Radio 4's The World At One: "Politics is a tough old game. I'm not going to get into it because half the people who were doing all the sledging, I genuinely don't know who they are."
Speaking on the steps of her campaign HQ, which had opened only that day in Westminster, the Energy Minister wished Mrs May "the very greatest success" and promised her "my full support".
The announcement came just moments after Mrs May launched her national campaign for what had been expected to be a nine-week contest.
In a speech in Birmingham, she sought to reassure Tory Eurosceptics that her support for Remain in last month's referendum would not stop her pushing ahead with Britain's withdrawal from the EU, saying: "Brexit means Brexit and we're going to make a success of it."
And she presented herself as the candidate of unity and experience, pointing out that she enjoyed the "overwhelming" support of Tories in Westminster, after winning an MPs' ballot last week with 199 votes against Mrs Leadsom's 84 and Mr Gove's 46.
Mrs Leadsom conceded the point, saying: "Theresa May carries over 60 per cent of support from the Parliamentary party. She is ideally placed to implement Brexit on the best possible terms for the British people and she has promised that she will do so."
The Energy Minister said she had concluded that "the interests of our country are best served by the immediate appointment of a strong and well-supported prime minister" and was offering Mrs May her "full support".
In a statement immediately after Mrs Leadsom's withdrawal, Mr Gove said: "We
should now move as quickly as possible to ensure Theresa May can take over as leader. She has my full support as our next Prime Minister."
And Mr Johnson - who abandoned an expected tilt for the leader's job after realising he faced competition from both Mrs Leadsom and Mr Gove - said he had "no doubt" that Mrs May would make an excellent party leader and PM.
Mr Johnson said: "Theresa May will provide the authority and the leadership necessary to unite the Conservative Party and take the country forward in the coming weeks and months. Andrea's decision, which is both brave and principled, allows that process to begin immediately.
"I have no doubt Theresa will make an excellent party leader and Prime Minister and I'm encouraged that she's made it clear that Brexit means Brexit - that we will leave the EU. It is vital that we respect the will of the people and get on with exploiting new opportunities for this country."
There were demands for Mrs May to call a snap general election, rather than waiting for the 2020 contest envisaged under Mr Cameron's fixed-term
parliaments legislation.
Liberal Democrat leader Tim Farron said: "With Theresa May's coronation we need an early general election. The Tories now have no mandate. Britain deserves better than this."
And Green MP - and leadership candidate - Caroline Lucas said: "Andrea Leadsom's decision to pull out of the leadership race underlines the necessity of a general election this year, something the Greens have called for since the EU referendum result was announced.
"It is unacceptable that the next person to hold the top job in British politics is appointed by 60 per cent of Tory MPs. They have no mandate to renegotiate Britain's place in the world in this post-referendum period. A general election is the only democratic way forward."
Mr Trickett said: "It now looks likely that we are about to have the coronation of a new Conservative Prime Minister.
"It is crucial, given the instability caused by the Brexit vote, that the country has a democratically elected Prime Minister. I am now putting the whole of the party on a general election footing. It is time for the Labour Party to unite and ensure the millions of people in the country left behind by the Tories' failed economic policies have the opportunity to elect a Labour government."
Former Ukip leader Nigel Farage, who had argued that the new PM must be a Brexit supporter, said he was "disappointed" that Mrs Leadsom had opted to withdraw from the Conservative leadership contest.
Conservative former Communities Secretary Sir Eric Pickles insisted there was no need for a general election.
He told World At One: "The last thing this country needs in all this chaos is another general election."
Sir Eric said the criticism Mrs Leadsom had faced did not compare to the challenges she would have faced as PM.
"Politics is a rough old game and, frankly, nothing happened over the weekend in comparison to having to negotiate with President Putin or the European Union," he said.
"I didn't see anything that was aimed at her as a person but I did see some reaction to some of the statements she's made."
Chancellor of Exchequer George Osborne said it was good news that May was now the sole candidate to become the country's next prime minister.
"Welcome news we have 1 candidate with overwhelming support to be next PM," Osborne said on Twitter. "Theresa May has strength, integrity and determination to do the job."