Labour high-flyer Ruth Kelly has been appointed education secretary following a cabinet reshuffle.
Ruth Kelly is seen as an intellectual in politics
Charles Clarke has taken over as Home Secretary following the resignation of David Blunkett.
Schools Minister David Miliband is also leaving education, to take over Ms Kelly's old role, and some critics say this means too many changes for education at a critical time.
Mr Miliband's post is being filled by Stephen Twigg, who was a junior education minister with responsibility for London.
Derek Twigg takes over from Stephen Twigg. He was previously parliamentary private secretary to two ministers.
This latest shake-up for education means a third education secretary in just over two years.
David Hart, general secretary of the National Association of Head Teachers, said losing two education secretaries so quickly was "not particularly helpful", but he said he did not expect significant changes in policy.
John Dunford, general secretary of the Secondary Heads Association, said: "I am disappointed to lose Charles Clarke and David Miliband six months before a
"Continuity is of paramount importance to deliver the school improvement
Ms Kelly, 36, became an MP in 1997 and has also worked at the Treasury.
Mr Clarke moves to the Home Office following David Blunkett's resignation on Wednesday.
NASUWT general secretary Chris Keates said Ms Kelly was an "unknown quantity" but praised her "sharp intellect".
She also paid tribute to Mr Clarke, saying: "Frank, robust and determined but always approachable, it was a pleasure to work with Charles Clarke."
Mr Clarke's most notable achievement during his time as education secretary was the passing of the Higher Education Bill earlier this year, despite a backbench rebellion by Labour MPs.
From 2006 universities in England will be able to charge up to £3,000 a year for courses.
Mr Clarke leaves as the future of exams is being debated
The policy made Mr Clarke, himself a former leader of the National Union of Students, deeply unpopular among undergraduates.
Mr Miliband is, like Ms Kelly, seen as a rising star within the Labour Party.
Ms Keates said: "No-one who comes into contact with David Miliband can fail to be impressed by his mastery of his brief, his grasp of detail and his willingness to respond positively to cogent argument."
Mary Bousted, general secretary of the Association of Teachers and Lecturers, said of Ms Kelly: "Her meteoric rise through the Labour ranks is testimony to her abilities.
"ATL wants to continue to work in partnership with the government to raise standards for all pupils. We look forward to meeting Ruth Kelly and getting on with the job together."
Ms Kelly was educated at Queen's College, Oxford, and the London School of Economics.
She was an economics writer in the early 1990s before joining the Bank of England.
Ms Kelly was elected MP for Bolton in the 1997 general election.
The mother-of-four enters her new job as proposals for an overhaul of education for 14 to 19-year-olds in England are being scrutinised.
If the plans, put forward by Mike Tomlinson, are incorporated in full in next year's white paper, a four-part diploma will replace the current system of GCSEs and A-levels.
However, the government has so far insisted GCSEs and A-levels will remain as distinctive components of whatever system is adopted.
Repeated failures to reach targets on school tests will also pose problems, as will continued rumblings over the workload agreement, designed to take administrative tasks out of teachers' hands.
Liberal Democrat education spokesman Phil Willis said the departure of Mr Clarke and Mr Miliband would leave a "catastrophic gap" in expertise.
Shadow Education Secretary Tim Collins congratulated Ms Kelly on her appointment, adding that she must "turn the Prime Minister's rhetoric on schools choice into something approaching reality".