Alan Johnson has dramatically resigned as shadow chancellor for "deeply personal reasons".
Labour leader Ed Miliband announced that Mr Johnson's position will now be taken up by Ed Balls.
Mr Johnson said in a statement: "I have decided to resign from the shadow cabinet for personal reasons to do with my family. I have found it difficult to cope with these personal issues in my private life whilst carrying out an important frontbench role.
"I am grateful to Ed Miliband for giving me the opportunity to serve as shadow chancellor of the exchequer. He is proving to be a formidable leader of the Labour Party and has shown me nothing but support and kindness.
"My time in Parliament will now be dedicated to serving my constituents and supporting the Labour Party. I will make no further comment about this matter."
Yvette Cooper will take her husband Ed Balls' former role as shadow home secretary, while Douglas Alexander becomes shadow foreign secretary, Liam Byrne will be shadow work and pensions secretary and Tessa Jowell takes over as shadow Cabinet Office minister.
Mr Miliband insisted that the appointment of Mr Balls would not mark any shift in Labour's economic policy, saying: "Ed brings great expertise to this role and I look forward to working with him on the direction Alan and I have set out".
He added: "Economic policy is unchanged. Actually, Ed and I have similar views.
"He's going to be continuing the direction of our economic policy which is about growth and jobs and cutting the deficit rather than this Conservative-led government that's going too far and too fast with deficit reduction."
Mr Miliband said Mr Johnson had resigned for "deeply personal reasons" that were "nothing to do with the job".