Hours after the Presidential spokesperson announced that the veteran military man Field Marshal Hussein Tantawi and his second in command were being "retired", crowds of people turned out to celebrate.
"Marshal, tell the truth, did Mursi fire you?" chanted a section of the crowd, mocking at the way the Army chief was packed off by an elected leader, something unprecedented in the country.
The sacking of Tantawi and chief of army staff General Sami Anan was presented officially as a retirement. They were both awarded Egypt's highest honour -- the Nile Medal -- and appointed 'advisers' to the President.
"The people support the president's decision," shouted the others.
Besides Tantawi and Anan, Mursi also ordered the retirement of the commanders of the navy, air defence and air force, besides canceling constitutional amendments issued by the military restricting presidential powers.
Tantawi, 76, who had served as defence minister for two decades under ousted leader Hosni Mubarak, was looked upon by many as a representative of the former dictator's era.
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In an address to the nation, Mursi said his move was not directed at individuals.
"I did not mean to send a negative message about anyone, but my aim was the benefit of this nation and its people."