Under the plan two panels would be appointed to make amendments to the Islamist-backed constitution passed under Mr Morsi's government. Those changes would be put to a referendum within about four months. Parliamentary elections would be held within two months after that, and once the new parliament convenes it would have a week to set a date for a presidential election.
While the move could ease Western concerns it is likely to anger ousted president Mohammed Morsi's supporters even more.
The swift action reflected Egypt's military-backed interim leadership's desire to push ahead with a post-Morsi political plan despite Islamist rejection - and is certain to further outrage the ousted president's Muslim Brotherhood. The Islamist group contends that Mr Morsi was removed by a coup and that everything that follows is illegal.
The "constitutional declaration" announced by interim president Adly Mansour coincided with the nation's deadliest day since Mr Morsi's July 3 removal, with more than 50 of his supporters killed by security forces as the country's top Muslim cleric raised the specter of civil war.
The killings further entrenched the battle lines between supporters and opponents of Mr Morsi, and his backers called for an uprising, accusing troops of gunning down protesters. The military blamed armed Islamists for provoking its forces.
The shootings began during a protest by about 1,000 Islamists outside the Republican Guard headquarters where Mr Morsi, Egypt's first freely elected leader, was detained last week. Demonstrators and members of the Brotherhood said troops descended on them and opened fire unprovoked as they finished dawn prayers.
After a battle lasting about three hours, at least 51 protesters were killed and 435 wounded, most from live ammunition and birdshot.
The Freedom and Justice party, the Muslim Brotherhood's political arm, called on Egyptians to rise up against the army, which it accused of turning Egypt into "a new Syria."
The sole Islamist faction that backed Mr Morsi's removal, the ultra-conservative Al-Nour Party, suspended its participation in talks on forming a new leadership for the country. The group is now torn by pressure from many in its base, furious over what they saw as a "massacre" against Islamists.
Reeling from scenes of bloodied protesters in hospitals and clinics, many with gaping wounds, some of Egypt's politicians tried to push new plans for some sort of reconciliation in the deeply polarized nation.
Sheik Ahmed el-Tayeb, the grand imam of Al-Azhar, the most prominent Sunni Muslim institution, demanded that a reconciliation panel with full powers immediately start work and that those detained in recent days be released. Five prominent Brotherhood figures have been jailed since Mr Morsi's fall, and Mr Morsi himself is held in detention in an unknown location.
There were multiple calls for an independent investigation into the bloodshed as a way to establish the truth and move forward.
Egypt's escalating crisis could further complicate its relations with Western allies, which had supported Mr Morsi as the country's first freely elected leader and now are reassessing policies toward the military-backed group that forced him out.
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