Armenian Prime Minister Nikol Pashinyan has warned of an "attempted military coup", after the country's armed forces said he and his cabinet must resign.
He was later seen marching with supporters in the capital Yerevan. The opposition staged a rival rally.
The army has been angered by the PM's sacking of top military commanders and criticisms of its performance.
Mr Pashinyan has faced mass protests after losing last year's conflict with Azerbaijan over Nagorno-Karabakh.
Nagorno-Karabakh is an enclave internationally recognised as part of Azerbaijan but which had been controlled by ethnic Armenians since a 1994 truce.
During the bloody six-weeks of fighting late last year, Azerbaijan not only recaptured areas around the enclave but also took the key town of Shusha inside it.
Under the Russian-brokered deal that emerged shortly afterwards, Azerbaijan keeps the areas it has captured. Hundreds of Russian peacekeepers are deployed in the disputed area.
What did Pashinyan say?
In a Facebook video post, Mr Pashinyan, 45, said he considered a statement by the military earlier on Thursday an "attempted military coup".
He urged his backers to gather on Republic Square in the heart of Yerevan, and was seen shortly afterwards walking with a loudspeaker surrounded by thousands of supporters on the streets of the city.
Mr Pashinyan later started making a passionate speech to his supporters.
Meanwhile, opposition supporters staged a rival demonstration in the capital, saying Mr Pashinyan must go.
There have been no reports of any violence.
The prime minister - who has recently survived several attempts in parliament to dismiss him - also said he had sacked Onik Gasparyan, the armed forces' Chief of the General Staff.
Mr Pashinyan, a former journalist, took office after leading a peaceful 2018 revolution in the post-Soviet state.
What did the military say?
The military issued its statement after Mr Pashinyan had initially dismissed Tiran Khacharyan, Mr Gasparyan's first deputy.
This happened after Mr Khacharyan had ridiculed Mr Pashinyan's claims that Russia-supplied Iskander missiles had failed to hit targets during the fighting in Nagorno-Karabakh.
Russia has a military alliance with Armenia and has an army base in the country, but it did not intervene during the conflict. It also has close ties with Azerbaijan and has sold weapons to both countries.
Azerbaijan was openly backed by Turkey during the fighting.
In its statement, the military said "the prime minister and the government are no longer able to make reasonable decisions", according to the Armenpress news agency.
"For a long time, the Armenian armed forces were patiently tolerating the 'attacks' by the incumbent government aimed at defaming the armed forces, but everything has its limits."
The statement accused Mr Pashinyan's government of making "serious mistakes in foreign policy" that resulted in the Armenian state being on the verge of destruction.
"The army has always been with the people, just like the people are with the army," the statement added.
What has the reaction been?
Armenian President Armen Sargsyan said he was taking urgent steps to end a political crisis, urging all sides to "show restraint and common sense".
Two Armenian opposition parties backed the military's demand for Mr Pashinyan and his government to resign, urging the prime minister to avoid a civil war.
In a statement, Armenia's National Security Service urged all sides to "refrain from actions that threaten national security".
Turkish Foreign Minister Mevlut Cavusoglu said: "We strongly condemn the coup attempt in Armenia."
Meanwhile, Russian President Vladimir Putin's spokesman Dmitry Peskov said Moscow was monitoring the situation in Armenia with "concern", and called for calm.
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February 25, 2021 at 08:06PM
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