Chancellor Angela Merkel took her seat in the public gallery on Tuesday as the German Parliament assembled without her for the first time in 31 years.
Mrs Merkel, 67, will be formally appointed as a caretaker chancellor later until talks on a new coalition are finished – which the parties involved hope will be before Christmas.
But she is no longer an MP after she did not stand at last month’s general election, when her Christian Democrats (CDU) slumped to their worst result yet.
Sitting beside German President Frank-Walter Steinmeier, she watched from the spectator seats as the new 736-seat assembly met in Berlin.
Carsten Schneider, speaking for the Social Democrats (SPD) who are the largest party with 206 seats, saluted Mrs Merkel for stepping aside with good grace.
“It’s a mark of this parliament and this country that a big party that has been in power for a long time gives it up fairly and peacefully,” he said.
Marcel Dirsus, a political scientist at the University of Kiel, said the presence of Ms Merkel in the public gallery was “a photo for the history books”.
Ms Merkel won her seat in 1990 at the first all-German election since the Second World War. She became chancellor in 2005. Her constituency in the former East Germany fell to the SPD at last month’s election.
The SPD, Greens and Free Democrats (FDP) are holding talks on a three-way coalition which is unheard of at national level.
They reached a preliminary deal this month in which they agreed to raise the minimum wage, expand solar and wind energy and stick to borrowing limits.
If they reach a final deal, Mr Steinmeier will formally propose SPD candidate Olaf Scholz, 63, as chancellor. He will then have to be confirmed by parliament, where the SPD, Greens and FDP have a combined 416 seats.
Before then, Mr Steinmeier will name Ms Merkel as caretaker. Her powers are not formally limited but previous chancellors have not made radical decisions in this period.
The new parliament is the largest yet. There are 255 women, including the first black woman in the German parliament, Eritrean-born Awet Tesfaiesus.
Tuesday’s session opened with controversy, as the far-right Alternative for Germany (AfD) demanded that one of its members should act as speaker.
Bernd Baumann, an AfD member, accused the other parties of bending parliamentary tradition to exclude the far right.
But the CDU's Michael Grosse-Bromer won applause for saying that the AfD’s candidate was out of the question because of his previous remarks trivialising the Nazi period.
“They have left no stone unturned in trying to damage this parliament,” he said of the AfD.