Nepal's President Bidhya Devi Bhadari has called all parties to work together to form a majority government.
President Bhandari had given a week's time for the formation of a new unity government. That time of one week expired on 1 June.
With no possibility of a unity government being formed, President Bhandari asked all parties to go for voting in parliament.
A statement issued by the President's office said, "Honorable President Bidhya Devi Bhandari, as per Article 298, Clause 2 of the Nepal Constitution, call for the parties represented in parliament to form a government on the basis of a consensus within seven days and form a government on 2074, 11th Jestha (2017/ May 28) has failed. As per Article 298, Clause 3 of the Constitution, all parties representing in the parliament are requested to form a government on the basis of a majority."
Acting Prime Minister Pushpa Kamal Dahal is now leading a caretaker government.
The Nepali Congress is now expected to form the next government with the support of the Unified Communist Party of Nepal (Maoist) led by Dahal.
Meanwhile, the main opposition Communist Party of Nepal-Unified Marxist Leninist) continued to disrupt parliamentary proceedings over a demand for the resumption of vote counting in Bharatpur.
Speaker Onsari Gharti Magar has called for a meeting of parliament on 28 may at 11 a.m.