The decree removed Crown Prince Mohammed bin Nayef – the king’s 57-year-old nephew – and replaced him with Mohammed bin Salman, 31, who was previously the deputy crown prince, SPA reported.
The newly-appointed crown prince was also named deputy prime minister and maintained his post as defence minister, according to SPA.
Mohammed bin Salman, who has close links with the US, is seen as a powerful figure in the kingdom and has been leading Saudi Arabia’s war in Yemen.
According to the Dubai-based broadcaster al-Arabiya, the appointment of bin Salman was approved by the kingdom’s Allegiance Council and a public pledging of loyalty for him will be held on Wednesday evening.
The Saudi Press Agency said 31 out of 34 members of the council voted in favour of the change.