Saudi Arabia's King Salman has appointed his son Muhammad bin Salman as crown prince, according to a royal decree carried by the Saudi Press Agency (SPA).

The 31 year old prince is seen as a dynamic leader with a new vision for the country's future and close ties with the United States. He rose to the top of the Saudi leadership when his father, 81, became king.

The king removed Crown Prince Muhammad bin Nayef -- his 57-year-old nephew --- and replaced him with Muhammad bin Salman, 31, who was previously the deputy crown prince, SPA quoted the decree as saying.

Nayef was not only removed as crown prince but also as interior minster. He is well respected in the country and credited with dismantling the Al-Qaeda network in the kingdom.

The newly appointed crown prince was also named deputy prime minister and maintained his post as defense minister, SPA said.

Muhammad bin Salman, who has close links with the United States, is seen as a powerful figure in the kingdom and has been leading Saudi Arabia's intervention in Yemen.

Dubai-based Al-Arabiya television said the appointment of bin Salman was approved by the kingdom's Allegiance Council. He was endorsed by 31 out of 34 members of the council.

The council voted 34 to 31 in favour of the new changes, according to Al-Arabiya.