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Rodney MacDonald closes his speech notes after speaking at the Mabou Community Centre on Tuesday, June 9, 2009 in Mabou, N.S.MIKE DEMBECK

Former Nova Scotia premier Rodney MacDonald resigned the leadership of the province's Conservative party on Wednesday.

Mr. MacDonald announced he was stepping down at the party's weekly caucus meeting in Halifax. The party said he will continue to serve as a member of the legislature for the riding of Inverness in Cape Breton.

He won the leadership in February 2006, edging out cabinet rival Neil LeBlanc, who was finance minister, and prominent Halifax businessman Bill Black.

He led the Tories to victory in the June 2006 provincial election, but only managed to secure a minority government.

Mr. MacDonald dropped strong hints he would step down after his party lost to the NDP and was reduced to third-place status in the June 9 election, winning just 10 seats in the 52-seat legislature.

Karen Casey, who was a member of Mr. MacDonald's cabinet, will serve as interim party leader.

Mr. MacDonald, 37, a former gym teacher, surprised many when he won the leadership.

He ascended quickly through several junior portfolios in former premier John Hamm's cabinet after he was first elected in 1999.

Mr. MacDonald appeared to be a fresh face, with a looser style than Hamm.

An award winning musician, the day before his leadership victory Mr. MacDonald played his fiddle for a ceilidh - a traditional Gaelic party - for cheering Tory delegates in a local pub.

Married, with a young son, he had been seen by many delegates as the ideal person to freshen the grandfatherly image of the Tory party.

But after he called an election in the summer of 2006, Nova Scotians didn't seem to warm to the leader as a potential reformer of his party.

Voters sent his government back to the legislature with a reduced minority standing, while Darrell Dexter's NDP continued to climb in popularity.

Over the past three years Mr. MacDonald's government endured a series of gaffes, including the resignation of cabinet minister Ernie Fage, who was later convicted of leaving the scene of an accident.

There was also embarrassment over a botched immigration program that was supposed to provide newcomers with professional job experience, but instead led some into menial roles.

Mr. MacDonald's greatest accomplishments were often tied to deals he made with Ottawa, but didn't seem to boost the premier's personal popularity.

Most notably, a federal tribunal settled a long-standing dispute on how much money the province should receive from offshore royalties on natural gas.

The Crown share settlement reached last year meant $870 million to the province over 15 years.

However, those funds caused Mr. MacDonald's government problems in the 2009 budget when he revealed that to balance the books, the province would have to alter laws guaranteeing the windfall would go to debt repayment.

At the beginning of the election race, Mr. MacDonald attempted to return to his youthful image, bouncing on a backyard trampoline in a Halifax suburb.

He balanced that with a stern message that Conservatives were better placed to steer the province through tough economic times than a "risky" NDP.

When the message failed to catch on, his party turned to negative advertising, including an attack ad that accused the NDP of taking questionable campaign contributions from unions and being beholden to labour bosses.