The Lib Dems' nomination for Steve Comer was vetoed
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Labour is to form the new administration in Bristol after weeks of debate.
The move comes after a meeting when the Liberal Democrats failed to win the leadership despite having the largest number of councillors.
New council leader Helen Holland (Labour) said: "We are very much a minority group and we made it clear this would not be our preferred option.
"It's a watershed issue and proved we needed to take control tonight."
The city council had technically been leaderless since Lib Dem Barbara Janke was sacked after disappointing local election results for her party.
The Lib Dems wanted councillor Steve Comer to take over.
But that nomination was vetoed by Labour and the Conservatives.