Japan PM in surprise resignation ...
Japan's PM hopes for fresh start with new cabinet ...
South Korea to recall Japan envoy ...
The resignation is regarded as a blow to new Prime Minister Taro Aso, who took office on Wednesday.
Mr Nakayama was criticised over a series of controversial remarks. He called Japan's largest teachers' union a "cancer" in the education system.
He also angered Japan's indigenous Ainu people last week, when he described the country as ethnically homogeneous.
Mr Aso is considering whether to call a snap election in a effort to shore up his authority.
His Liberal Democratic Party (LDP) has dominated Japanese politics for more than 50 years, but is now facing a resurgent opposition.
The last prime minister, Yasuo Fukuda, resigned earlier this month after less than a year, frustrated by the ability of the opposition-controlled upper house of parliament to stymie his legislative plans.
(BBC)
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