A Liberal split on Shellharbour City Council saw the party lose the mayoral position.
It came just 12 months after the party won two seats on the traditionally Labor-dominated council.
Councillor Kellie Marsh, the city's first Liberal mayor, was dumped from the top job at Tuesday night's meeting after a surprise challenge from party colleague Paul Rankin.
With the councillors electing one of their number for the position of mayor, Cr Rankin had only told Cr Marsh he planned to stand minutes before the start of the meeting.
However, he denied it was an ambush, saying he felt Cr Marsh didn't have the numbers and he put his hand up so there would be a Liberal in either the mayor or deputy mayor position.
The move opened the way for former Labor deputy mayor Marianne Saliba to gather enough votes for the top job.
Then, with the votes of the three Labor councillors, Cr Rankin picked up the deputy mayor's position.
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