Romania's parliament has refused to lift Prime Minister Victor Ponta's immunity from prosecution after he was questioned on suspicion of forgery, tax evasion and money laundering.
Mr Ponta, who has come under pressure to resign, said he would stay on to prevent a protracted political crisis.
Anti-corruption officials are looking at his work between 2007 and 2011.
Parliament is dominated by Mr Ponta's centre-left coalition so Tuesday's vote to block prosecution was unsurprising.
A total of 231 MPs rejected a request by prosecutors to lift his immunity, while 120 MPs backed it.
'I am innocent'
Romania's powerful DNA anti-corruption agency questioned the prime minister on Friday.
It has been investigating allegations that Mr Ponta used forged invoices from a law firm, Sova and Associates, to buy two luxury apartments and a Mitsubishi Lancer car, according to Romanian media.
Mr Ponta was an associate at the firm from 2007-2008 and an opposition MP from 2008-2011.
But the Social Democrat (PSD) prime minister, in office since 2012, has denied any wrongdoing and says his government will survive a no-confidence vote in parliament due on Friday.
"I will present all evidence, because I haven't had any possibility up to now to do it, and I am absolutely sure that I am innocent," he told foreign media on Tuesday.
Centre-right President Klaus Iohannis, who defeated Mr Ponta in last year's presidential election on an anti-corruption platform, said he regretted that parliament was obstructing justice and acting as a shield for the prime minister "in contempt" of the Romanian population.
"I still consider that the solution to overcome the current situation is the resignation of Victor Ponta as prime minister," he said.
But Mr Ponta said if he resigned, it could trigger a political crisis lasting up to five months.
Romania has for years been helped by aid from the European Union and International Monetary Fund, and the prime minister warned that key talks due in the coming weeks could be placed in jeopardy.
"It is fundamental to show that we are not dealing with a long-term crisis," he said.
The DNA has arrested several well-known figures in recent months, with former government ministers, media moguls, judges and prosecutors all under investigation.
They include Elena Udrea, a former minister of tourism and former presidential candidate.
The DNA investigation has also spread to Mr Ponta's mother, sister, brother-in-law Iulian Hertanu and senator Ilie Sarbu, who is his father-in-law.