Kosovo's ruling coalition had been strained by growing discord between its two main parties, Thaci's centre-right PDK and the conservative LDK of Prime Minister Isa Mustafa.
The main trigger for the confidence vote, held Wednesday, was a border demarcation deal with neighbouring Montenegro, the final condition for obtaining visa-free travel in the European Union.
The opposition strongly opposes the deal, claiming that it gives to Montenegro several thousand hectares of land that has traditionally been used by Kosovo's shepherds.
Kosovo's parliament has yet to ratify the deal, and the opposition has fiercely protested the plan, releasing tear gas in parliament on several occasions and organising street protests, some of which were marred by serious violence.
"The work the EU has started with Kosovo institutions should not stop because of upcoming elections," the bloc's representative in Pristina, Nataliya Apostolova, told local TV, urging the new parliament to approve the deal.
The crisis was also fuelled by an agreement reached with Serbia, its former enemy, in August 2015 that envisages political autonomy for the Serb minority in the Balkan territory.
The plan is also sharply contested by the opposition.
Thaci's PDK eventually joined with other opposition parties to push for a snap parliamentary election, which was originally scheduled for next year.
Western analysts say the move could reflect a bid by the PDK to boost its popular legitimacy while a new special tribunal at The Hague prepares to try former leaders of the Kosovo Liberation Army (KLA) for alleged war crimes.
Thaci, a PDK founder and its longtime leader, is one of several former guerrillas cited as potential indictees.
The 1998-1999 conflict between ethnic Albanian rebels and Serbian forces was the last of the wars that tore apart the former Yugoslavia.
The war ended after a NATO bombing campaign against Serbia, which led to the withdrawal of Serbian forces from Kosovo.
Kosovo, with a mainly ethnic Albanian population of about 1.8 million, unilaterally declared independence from Serbia in 2008.
The move has been recognised by more than 110 countries, but Serbia, supported by its traditional ally Russia, still rejects it.
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