Rajoy is the first Spanish prime minister in modern history to be defeated by a no-confidence motion, ending his six-year tenure, the BBC reported.
The reputation of Rajoy's Popular Party had been largely damaged after a court verdict said it was a beneficiary of a massive kickbacks-for-contracts scheme.
Rajoy was in attendance at the ceremony held in the royal Zarzuela Palace and shook Sanchez's hand after the new leader was sworn in by King Felipe VI before they posed for a photo with the monarch along with the speakers of the lower Congress of Deputies and the Senate.
"It has been an honor to leave Spain better than I found it", Rajoy said in his final comments as prime minister.
A week ago, after the corruption convictions, Pedro Sánchez, a Socialist and the main opposition leader, filed a motion for Parliament to vote on the government, citing the scandal.
Sanchez said on Thursday that one of the priorities of his government would be "rebuilding bridges" with regions and "establishing the foundations that allow us to normalize relations and start a dialogue between the Spanish government and the new government in Catalonia". The report notes that Rajoy's ouster by parliament is a first for a serving leader in four decades of Spanish democracy.
All of his allies in the no-confidence motion stressed their vote against Rajoy was not a blank cheque for Sanchez.
Lawmakers stood and cheered in parliament as the untested 46-year-old - a pro-European lawmaker who has never been in government - became the country's seventh head of government since its return to democracy in the late 1970s.
He was ousted by his own party in 2016 over back-to-back losses in general elections and after he tried to block Rajoy's bid to form a government.
Sanchez and his party are staunch supporters of the European Union and the continent's shared currency.
Once he negotiated the support of several smaller parties, including Basque and Catalan nationalist groups, he had momentum for the no-confidence vote.
The former economics professor and career politician regained the Socialists' leadership past year.
He faces a tough time, however, catering to demands from small nationalist parties whose votes he captured in the no-confidence motion.
He has already committed to respecting a budget passed by Mr Rajoy, and the fragmented parliament means Sanchez will find it hard to row back on structural reforms passed by his predecessor, including new labour laws and cuts in healthcare and education.
His failure to resolve the political crisis caused by the standoff contributed to dissatisfaction with him, though the no-confidence vote - backed by Catalan pro-independence parties - was triggered primarily by a long-running corruption trial involving members of his center-right party.
The PSOE only holds 84 of 350 seats in the Spanish parliament, meaning it is not clear if the party will be able to govern effectively.
He has promised to call a new election before the end of this term in 2020.
Us Weekly and People both reported that Cena, 41 and Bella, 34, have rekindled their relationship after calling it quits in April. Nikki responded saying that she just wants both of them to be happy, whether it's together or not.
Police have said they responded to numerous calls related to the teenager in the years leading up to the massacre . He doesn't want the shooter to get more publicity, but he believes the recordings are very important evidence.
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Trump told that French President Emmanuel Macron last month, CNBC said with a reference to German magazine Wirtschafts Woche. Shares of Daimler (DAI-DE), Porsche (PAH3-DE) and Volkswagen (VOW3-DE) were all trading off around 1 percent on the news.
She said that when police ignored her request at the behest of Herman to leave, he threw his identity card out. Lucile Garcia, 45, was the head of the police corps and her 56-year-old colleague was a twin mother.
While Luke will probably have a key role to play in the new movies, it’s certain the new actors will dominate the storyline. He felt he needed to know what all those years have done to Luke even if the material doesn’t get told in the actual movie.
The government said it was not aimed at any religion in particular and was not banning headscarves, turbans or Jewish skull caps. Telling women how to dress doesn't liberate them - it denies them the right to make their own choices.
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Spectacular dancers will complement the spectacular dance of any composition, leaving an unforgettable impression in your memory. A special chic to the club is given by colorful and incendiary performances, over which a professional choreographer works.
The reputation of Macao as the place of the famous casinos, brothels and clans triads selling opium was born in the 18th century. And it lasted until the 60s of the 20th century, while a powerful businessman Stanley Ho became interested in the region.