Trump named as acting attorney general Matthew Whitaker, Sessions' chief of staff, who as a legal commentator last year wrote that Special Counsel Robert Mueller appeared to be taking his investigation too far.
A Justice Department official said Wednesday that Whitaker would assume final decision-making authority over the special counsel probe instead of Deputy Attorney General Rod Rosenstein.
Since last year, Rosenstein has overseen the investigation because Sessions, a key Trump surrogate in 2016, recused himself from dealing with matters involving the campaign. It wasn't immediately clear what role, if any, Rosenstein may play in the probe going forward.
As acting attorney general, Whitaker could sharply curtail Mueller's authority, cut his budget or order him to cease lines of inquiry.
Within hours of his appointment, there were mounting calls by congressional Democrats and government watchdog groups for Whitaker to recuse himself, citing critical comments he made about Mueller's investigation.
Furious Democrats, emboldened by winning control of the House in Tuesday's elections, also promised to investigate Sessions' forced resignation and suggested Trump's actions could amount to obstruction of justice if he intended to disrupt the criminal probe.
"There is no mistaking what this means, and what is at stake: this is a constitutionally perilous moment for our country and for the President," Rep. Jerrold Nadler, D-N.Y., said in a statement. He is set to take over in January as chairman of the House Judiciary Committee, the panel that would oversee any impeachment proceedings.
Sen. Richard Blumenthal of Connecticut called Wednesday's events "a break-the-glass moment" and said he would be introducing legislation to protect Mueller's work.
"Any attempt to limit his resources or the scope of his investigation is unacceptable," he said. "The world, and history, are watching."
A spokesman for Mueller declined to comment.
Trump's decision to push Sessions out conflicted with comments he offered during a news conference on Wednesday when he insisted he had a right to end the investigation but said that he would prefer to "let it go on."
"I could fire everybody right now, but I don't want to stop it because politically I don't like stopping it," Trump said. "It's a disgrace. It should never have been started, because there is no crime."
Justice Department officials said Whitaker will follow the regular process for reviewing possible ethical conflicts, a process that involves ethics lawyers reviewing an official's past work to see whether there are financial or personal conflicts that preclude them from being involved in particular cases.
Whitaker, a former U.S. attorney in Iowa, once mused as a legal commentator about how a Sessions replacement might reduce Mueller's budget "so low that his investigation grinds to almost a halt." In an August 2017 tweet, he wrote that an opinion piece calling the special counsel investigation a "Mueller lynch mob" was "worth a read."
Whitaker also wrote in a September 2017 column that Mueller had "come up to a red line in the Russia 2016 election-meddling investigation that he is dangerously close to crossing" after CNN reported that the special counsel could be looking into Trump and his associates' financial ties to Russia.
He also has ties to Sam Clovis, who served as Trump's national campaign chairman and has been interviewed as a witness by Mueller's investigators about his interactions with foreign policy adviser George Papadopoulos. Whitaker chaired Clovis' campaign for Iowa state treasurer in 2014.
"We're currently friends," Clovis said of Whitaker in an interview with The Washington Post on Wednesday. "I texted him congratulations today."
Whitaker has not been confirmed by the Senate and, by law, can serve for only 210 days before he must be replaced by someone who has been confirmed. That period could be extended if Trump nominates a replacement who is not immediately confirmed.
If Whitaker takes over direct supervision of the Russia investigation from Rosenstein, he would assume budget authority for Mueller's work, giving him the ability to sharply reduce Mueller's staff and resources. His approval would also be required before Mueller could take major investigative steps, including asking a grand jury for additional indictments.
Any report that Mueller issues describing his overall findings would be submitted to Whitaker, who could decide it contained privileged material that should not be made public.
"Discretion is such a part of what prosecutors do," said former U.S. Attorney Barbara McQuade. "He can't obstruct justice, but he would have the ability to make discretionary decisions that could in many ways influence the outcome of the investigation."
Still, Whitaker faces some limitations.
Justice Department regulations would allow him to fire Mueller, but only for misconduct, conflict of interest or other "good cause."
The regulations would allow him to reject requests by Mueller to take major steps in the investigation. Should he do so, however, he would be required to provide the chairmen and ranking members of the House and Senate Judiciary Committee a "description and explanation of instances" in which he overruled the special counsel.
Whitaker's appointment comes at a particularly critical moment, just as Mueller was expected to end what has been a publicly quiet phase of his investigation.
In the run-up to Election Day, there were no indictments or public pronouncements by the special counsel's office, in keeping with Justice Department guidelines that prosecutors should avoid taking steps that could be perceived as intending to influence the outcome of the vote.
With the midterm elections now over, Mueller faces key decision points in his 18-month-old investigation into Russian interference in the 2016 campaign - a probe that has led to charges against 32 people, including 26 Russians. Four aides to Trump have pleaded guilty to various charges, most recently his former campaign chairman Paul Manafort in September.
Among the most pressing matters now before the special counsel: a probe into longtime Trump adviser Roger Stone's activities and ongoing negotiations with Trump's legal team over a request to interview him.
For months, Mueller has been seeking to question Trump as part of his investigation, which is also examining whether the president has sought to obstruct the probe.
Mueller's prosecutors have laid out detailed allegations of how Russia sought to manipulate Americans through social media, break into state voting systems and hack the email accounts of Democratic committees and party leaders.
But the special counsel's team has not indicated publicly that it has drawn any conclusions about whether Trump associates conspired with the Russians or whether the president obstructed justice.
Behind the scenes, Mueller's investigators have been intensively gathering evidence and questioning witnesses in recent weeks.
The grand jury hearing evidence in the Russia investigation has been seen meeting at a federal courthouse in Washington, D.C., on six of the last eight Fridays.
Based on witnesses who have been called to the grand jury, the special counsel appears to be intensely focused on Stone.
The longtime Trump friend and former adviser is under scrutiny for claims he made in the 2016 campaign that suggested he was in contact with WikiLeaks. In the final months of the White House race, the group published Democratic emails that prosecutors allege were hacked by Russian military operatives.
Stone has repeatedly maintained that he was not in touch with WikiLeaks and did not have advance knowledge of its plans. He said he based his comments on publicly available interviews with WikiLeaks founder Julian Assange and tips from associates, including New York comedian and radio host Randy Credico, who interviewed Assange on his program in August 2016.
Credico has denied serving as a back channel to Assange for Stone.
In recent weeks, two more Stone associates testified before the grand jury - among at least nine people connected to Stone who have been contacted by prosecutors so far.
Filmmaker David Lugo and lawyer Tyler Nixon both told The Washington Post last month that Credico acknowledged to them he gave Stone information from Assange. Lugo, who appeared before the grand jury Oct. 19, said he turned over text messages and emails to Mueller's team. Nixon said he testified last week.
Separately, conservative writer Jerome Corsi was interviewed by investigators over three days last week and appears to be emerging as a key witness in the Mueller investigation into Stone's activities.
In an appearance on his live-streamed Internet show Monday, Corsi told viewers that he has been in near-continuous contact with Mueller's team in recent weeks.
"It's been two months, on a really constant basis in the Mueller investigation. It's been one of the biggest pushes of my life," said Corsi, who added that he could provide no specifics of his interactions with Mueller.
David Gray, an attorney for Corsi, declined to comment.
Meanwhile, the special counsel must decide whether to accept only written answers from the president or to fight for an interview. Such a move would probably require issuing a subpoena to the president, which would then draw a legal challenge from Trump's team.
By mid-November, the president's attorneys plan to turn over Trump's written answers to roughly a dozen questions the special counsel has posed - including the president's knowledge of the hacked Democratic emails and his advisers' contacts with Russians during the campaign and transition, according to two people familiar with the decision.