Zuma said the ANC was projected by the opposition in that as no longer enjoying majority support.
The result suggests that at least 26 of the ruling party's 249 members voted with the opposition, who had taken pains to portray their motion as an attempt to dislodge a weak and unpopular president, not an assault on the ANC. Peter Granitz reports from the capital, Pretoria, that while Zuma stays on as president, he has lost the support of some members of his party.
However, Tuesday's vote of no confidence, which was held in secret, makes it clear that the ruling party will not allow opposition parties to dictate how it resolves its internal problems.
Zuma has been engulfed by corruption allegations while in office.
Protesters had carried posters saying "Fire Zuma" and a cartoon of Zuma in a dustbin.
"That said, most votes for a ANC new party leader are made by local branches, where Mr. Zuma appears more popular", Jackson added.
Democratic Alliance leader Mmusi Maimane, who tabled the motion, had earlier asked MPs to act "courageously" and vote Zuma out. "Despite the challenges we face as a country, we remain steadfast in our commitment to entrench the gains of our democracy", an ANC statement said after the win.
According to the head of State, no one has ever received so many votes in South Africa as the ANC (which won more than 11 million votes in the 2012 election).
Eight previous no-confidence motions against Mr Zuma failed - but they were all held via an open process. "It is their own imagination", Mr Zuma told a cheering crowd.
Zuma's critics see him as having delegitimized the ANC, the liberation movement that has governed South Africa since the election of Nelson Mandela as the country's first democratic president put a definitive end to apartheid in 1994.
Several ANC members of parliament who publicly stated that they would vote with the opposition for Zuma's removal received death threats, while others had said that they would vote with their conscience on the day.
"The motion of no-confidence is. negative", Baleka Mbete, speaker of the 400-member parliament, said.
He replaced ministers and deputy ministers, including his respected finance minister, Pravan Gordhan, with mostly loyalists and political allies. The move sent the nation's currency into a tailspin and prompted two credit ratings agencies to downgrade South Africa to junk status.
The ANC parliamentary party celebrated victory over what it described as an attempted "soft coup".
As for the economy, South Africa fell into recession for the first time since 2009 when GDP contracted for the second straight quarter in the first three months of this year.
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