The Canadian-born environmental campaigner, 40, said she just found that she was ineligible to serve in office as she also holds Canadian citizenship, Xinhua news agency reported.
Under Australian constitutional law, a candidate holding dual citizenship is not allowed to run for Parliament.
The Greens Party senator, who moved to Australia when she was 11 months old and has served in the upper house since 2011, fought back tears as she fronted the media at a press conference.
"I have been under the impression all my life that I was not a Canadian citizen," Larissa Waters said.
"I thought that when I was naturalised as a baby, that was it, I was just an Australian."
"I have lived here almost all my life and I was devastated to discover the law had changed a week after I was born and that I needed to have taken active steps to renounce what was my Canadian citizenship, which I was unaware of."
The political blunder was sparked by another Greens senator, Scott Ludlam, after he resigned just days ago for the same reason.
Born in neighbouring New Zealand, the 47-year-old said he was also unaware of his dual citizenship and was forced to resign after serving more than a decade in the senate.
When Waters saw the events unfold, she decided to check the status of her own eligibility.
"I had confirmation by the Canadian High commission yesterday," Waters said.
"It's pretty weird that someone that's born in a country and leaves as a baby and has never been back, with two Australian parents turns out they have citizenship in that country, so I hope people will understand this is an honest mistake," Waters said.
Her replacement in the upper house will be 52-year-old Greens member Andrew Bartlett, who has also been plagued by controversy.
In 2003, Bartlett was leader of the now defunct Democratic Party and resigned over alcohol-related health problems, after he allegedly assaulted and hurled abuse at a female government senator.
With 23 other foreign-born politicians serving in Australia, it is quite feasible to think there may be more parliamentarians susceptible to the strict dual-citizenship laws.
As for Waters, "I've spent my entire life protecting the environment and working for equality for women and I'm not going to stop now," she said.
(This story has not been edited by Social News XYZ staff and is auto-generated from a syndicated feed.)
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