Sharif insists that his party will continue to support Prime Minister Yousuf Raza Gilani, who is from the Pakistan Peoples Party (PPP) of former Prime Minister Benazir Bhutto, who was assassinated in December.
But Sharif told journalists in Islamabad that the ministers from his own Pakistan Muslim League-Nawaz (PML-N) would leave the 6-week-old government because the coalition had missed a May 12 deadline to reinstate the judges. Sharif also called President Pervez Musharraf a "dictator," saying Musharraf had destabilized democracy in Pakistan by sacking the judges.
"Our parliamentary party meeting has also decided that we will not be a part of any conspiracy which strengthens a dictator," Sharif said. "We will not allow the democratic process to be destabilized."
Musharraf dismissed about 60 judges in November -- including Supreme Court Chief Justice Iftikhar Muhammad Chaudhry -- after issuing a presidential decree that imposed six weeks of emergency rule. Both moves were seen as a bid by Musharraf to preempt a ruling against his reelection in October while he was still army chief.
Despite the bitter differences, the PML-N is unlikely to move onto the opposition benches because it needs support from the Pakistan People's Party to keep its provincial government in Punjab Province.
However, some analysts say that even if Sharif's party drops its support for Gilani's government, the PPP-led administration could survive with the support of smaller parties in Pakistan, including Musharraf's allies.
"The Pakistan Muslim League[-Nawaz] is a right-wing political party, and they made the restoration of the judiciary, particularly the former Chief Justice Iftikhar [Muhammad Chaudhry], their No. 1 priority from the beginning," says Fazal ur Rahim Marwat, a political analyst in Pakistan's northwestern city of Peshawar. "But the [Pakistan] Peoples Party wanted to keep all judges current and go for a half-way compromise. People in Pakistan also think that the restoration of the judges is not the only issue. But the Pakistan Muslim League is adamant to project it as the most important issue."
In an interview with RFE/RL's Radio Free Afghanistan, Marwat predicts that with the disintegration of the alliance between the two parties, their relations will increasingly turn hostile as both look for new allies. He says that could ultimately strengthen the position of the embattled Musharraf.
"There are already the prospects of creating a third [parliamentary] grouping," Marwat says. "It will be made of the elements of the pro-Musharraf Muslim League (Quaid-i-Azam) and Pakistan Muslim League-[Nawaz]. This group will start supporting the Pakistan Peoples Party government after the current coalition falls apart."
'Make Or Break Issue'
In an interview with Reuters, Teresita Schaffer, director of the South Asia Program at the Washington-based Center for Strategic and International Studies, says the issue of the judiciary is important both to the government coalition and to Pakistan's future.
"Looking at it from the point of view of the government coalition -- for Nawaz Sharif and for his party -- this is a make or break issue," Schaffer says. "This is probably the most important issue they can peg it on. For the PPP, it is a much more ambiguous situation. They have some reservations about the consequences of restoring the judges. But they have basically signed on to a program at the end of which they expect the judges to be restored."
Analysts say the reinstatement of the judges would likely cause major headaches for Musharraf. That's because the judges could revive the case against Musharraf that challenges the constitutional validity of his reelection. That also could complicate U.S. military efforts in the war against terror because Musharraf is a key U.S. ally in that fight.
However, U.S. State Department spokesman Sean McCormack says Washington is convinced that the political crisis will not prevent the United States from working with Pakistan's government to fight terrorism.
"How the Pakistanis arrange themselves politically, who is in the coalition, who's not, what the platform is, questions about judges, these are all things for the Pakistanis to answer," McCormack says. "We neither want to, nor can, answer these questions for the Pakistani political leaders and their political system. They are going to have to address it. We're going to continue to work with the government on issues that are of mutual concern."
Sadiqul Farooq, a spokesman for Sharif's party, sharpened the tone after the announcement of the cabinet resignations. Farooq accused individuals in the Pakistan Peoples Party of "serving the interests" of Musharraf by blocking the restoration of the judges. Farooq also claimed that Zardari aides have had secret contacts with Musharraf.
But PPP spokesman Farhatullah Babar denied that there has been any behind-the-scenes contact between the PPP and Musharraf. Babar insists that the PPP remains committed to restoring the judges.
Radio Free Afghanistan correspondent Abubakar Siddique contributed to this report