Car horns sounded after Saied made the announcement following an emergency meeting at his palace.
Earlier, thousands of Tunisians had marched in several cities protesting about government failures in the North African nation and crippling coronavirus rates.
In the capital Tunis, hundreds of protesters had gathered in front of parliament, shouting slogans against the Islamist-inspired ruling Ennahdha party and premier Mechichi, with the crowd call for the “dissolution of parliament”.
Tunisia has been overwhelmed by Covid-19 cases, including more than 18,000 people who have died in a country of around 12 million.
Protests were also reported in the towns of Gafsa, Kairouan, Monastir, Sousse and Tozeur.
“The constitution does not allow for the dissolution of parliament, but it does allow for its work to be suspended,” the president said, citing Article 80 which permits such a measure in case of “imminent danger”.
Saied said he would take over executive power “with the help” of a government headed by a new chief appointed by the president himself.
He also said that the immunity would be lifted for parliamentary deputies.
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