Julia Gillard remains Australia's prime minister after she threw her job open to a leadership ballot but no one ran against her.
Her predecessor Kevin Rudd, who she ousted in an internal party coup in 2010, had been expected to attempt to replace her.
At the last moment he said he would not contest the ballot on Wednesday.
Senior minister Simon Crean had earlier brought leadership unrest to a head by calling on government colleagues to sign a petition to force a ballot if Ms Gillard refused to call one.
The Labour party faces the growing prospect of a sound election defeat on September 14.
Ms Gillard announced the ballot, and that of Deputy Prime Minister and Treasurer Wayne Swan, on the last day of parliament before a seven-week break.
Mr Crean – a former Labour leader – said he wanted to be deputy leader and called on Mr Rudd to challenge for the top post.
Opinion polls show that Mr Rudd would be a far more popular choice of the public.
He led Labour to victory at elections in 2007 before being deposed. He challenged Ms Gillard last year, but was defeated in a poll of Labour politicians.
"Kevin Rudd in my view has no alternative but to stand for the leadership," Mr Crean said.
Mr Rudd took a different view, and Ms Gillard was elected unopposed.
The events came after Ms Gillard delivered a national apology in parliament to the thousands of unwed mothers who were forced by government policies to give up their babies for adoption over several decades.
More than 800 people heard the apology and gave a standing ovation.
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