The king of Nepal has taken control of the government and deployed troops around the homes of politicians. The capital is largely isolated from the outside world with the international airport closed and communications cut off, but King Gyanendra denies he has staged a coup d'etat.
Troops surround the homes of Nepal's political leaders including the prime minister, while military vehicles with mounted machine guns patrol the streets of the capital, Kathmandu.
These radical steps accompanied King Gyanendra's announcement early Tuesday that he had dismissed Nepal's government, and would form a new cabinet to rule for the next three years.
This is the second time in the past two years that King Gyanendra has sacked Prime Minister Sher Bahadur Deuba, but the king denies he has staged a coup.
Speaking on state-run television, the monarch criticized political leaders for failing to organize national elections, and blamed them for the continuing insurgency against the government by communist guerrillas. The government is virtually paralyzed by feuding political parties and the Maoist insurgency.
Sukh Deo Muni, a professor of international affairs at Jawaharlal Nehru University in India's capital, New Delhi, says the king's moves come as no surprise.
"It was very much in the air," he said. "He was moving various of his cronies to go on making statements that 'we want [the] King's direct rule.' Then he's not coming to India - he canceled his visit. I was quite convinced it was coming any of these days."
For more than two years, Nepal has been locked in a three-way power struggle between the king, party leaders and the rebels, who launched their insurgency in 1996 in an effort to overthrow the monarchy. In recent months, they have successfully blockaded the capital and they control large swathes of the countryside.
Officially known as the Communist Party of Nepal, the insurgents loosely model their movement on the teachings of the late Chinese leader Mao Zedong. Peace talks between the government and the rebels collapsed in 2001.
Mr. Muni says it is possible the king privately contacted the rebels about peace talks before dismissing the government. But he says it is also possible the king is planning a military offensive.
"But the second possibility is that the conflict would become far more serious," he said. "He would let lose his army to do whatever it wants to do, whatever it can do, and the Maoists would fight, because the Maoists are already on a strategic offensive."
Analysts also warn there may be civil unrest once political party leaders organize their supporters to take to the streets in protest of the king's moves.
The king says he will announce his new cabinet in the next few days.