Ibrahim was reassigned to the post of security advisor to the prime minister, the presidency said in a statement. He was replaced by Major-General Magdi Abdel-Ghaffar, who served as the director of the interior ministry's National Security Apparatus, specialising in religious extremism.
Ibrahim, recently a controversial figure amid a perceived heavy security crackdown on dissent, was appointed by toppled Islamist president Mohamed Morsi. He was one of the few ministers to keep his post after Morsi's removal in July 2013, and survived an assassination bid in September of the same year.
Prime Minister Ibrahim Mahlab said the purpose of the cabinet reshuffle is "to inject new blood" in the government, according to Egypt's state news agency MENA.
He told a press conference on Thursday that he expects the move to have no effect on a high-profile investment conference scheduled to take place in Sharm El-Sheikh between 13-15 March, through which Egypt seeks to lure back investors to revive its cash-strapped economy.
The presidency also introduced two new cabinet portfolios: a ministry of state for population and another for technical education, bringing the total number of new ministers in the government to eight.
The other new ministers announced on Thursday are Salah El-Din Helal for agriculture, Abdel-Wahed El-Nabawi for culture, Moheb El-Rafie for education, Hala Mohamed Youssef for population, Khaled Ali Negm for communications, Khaled Abbas Rami for tourism and Mohamed Ahmed Yousef for technical education and training.
Human rights activists and opposition figures have been calling for Ibrahim's dismissal since the death of leftist activist Shaimaa Sabbagh during a peaceful demonstration on the eve of the fourth anniversary of the 2011 uprising.
Ibrahim's removal comes against the backdrop of a worsening security situation amid a surge in militant violence based in the border Sinai region, and mainly targeting security forces.
The attacks, which have extended to other cities including the capital cairo, have also led to civilian casualties.
On Monday, a string of bomb attacks hit the capital, killing two people outside a courthouse in central Cairo.
Late in January, at least 30 people, mostly soldiers, were killed in a series of militant attacks against security targets in North Sinai.
The cabinet's last reshuffle took place in June 2014, when 13 ministers were replaced, most of which were not included in Thursday's changes, save for the ministries of agriculture and culture.
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