BBC REPORTS FROM ATHENS

Viewers watching the news on the main TV channel saw the screens go to black late on Tuesday evening.

All employees have been suspended pending a re-organisation. Thousands of people held a protest against the decision outside ERT headquarters.

It is the latest move in rafts of spending cuts and tax rises aimed at leading the country out of recession.

"ERT is a case of an exceptional lack of transparency and incredible extravagance. This ends now," government spokesman Simos Kedikoglou said earlier.

While all 2,500 employees would be sacked, he added they would be paid compensation and would be able to apply for work when the corporation relaunches as a smaller, independent public broadcaster.

The head of ERT's foreign desk, Odin Linardatou, said the announcement took journalists by surprise.

"We are very shocked, we are angry," she told the BBC's Newshour programme. "What I cannot accept in a democracy is that Greece will not have a public broadcaster."

Riot police have been deployed in Athens as thousands of people have gathered outside ERT's headquarters to protest against the decision.

Authorities confirmed that the Hellenic Broadcasting Corporation (ERT) had been formally disbanded, as transmissions gradually stopped on Tuesday night.

"This is a blow to democracy," said ERT newsreader Antonis Alafogiorgos at the end of the main TV station's final broadcast.

The Athens Journalists' Union has called a 48-hour strike to protest against the closure.

ERT employee Vayia Valavaki said the government was trying to "scare" people.

"I am now a laid-off single mother with a young child," she said. "How exactly is this country protecting me? Why are they leaving me without work?"

ERT, which began broadcasting in 1938, is funded by a direct payment of 4.30 euros (£3.80; $6) added monthly to electricity bills.

It ran three domestic TV channels, four national radio stations, as well regional radio stations and an external service, Voice of Greece.

In April, parliament passed a bill which would see 15,000 state employees lose their jobs by the end of next year.

The law was a condition for Greece to receive its next tranche of international loans worth 8.8bn euros (£7.4bn; $11.4bn).

Since 2010, the European Union and the IMF have promised more than 200bn euros in lending for Greece, the first country to be hit by the eurozone crisis.

The government has imposed tough austerity measures in return for aid, including cuts in pay and pensions leading to numerous general strikes.