A by-election was held for the New South Wales Legislative Assembly seat of Ryde on 18 October 2008 to coincide with the Port Macquarie, Lakemba and Cabramatta by-elections. The by-election was triggered by the resignation of sitting member and Deputy Premier John Watkins, who cited exhaustion and the lack of time spent with his family for his resignation. Watkins resigned from parliament and his portfolio of Minister for Transport on 8 September 2008, prompting a Cabinet reshuffle.
The by-election was won by Liberal candidate Victor Dominello on a swing of 23%. This was a marked turnaround to the result at the 2007 state election, when Dawkins was reelected with 60.09% of the two-party preferred vote. However, at the time the writ was dropped, Labor had been sinking in the polls since being reelected a year earlier. It had suffered from several months of bad press that had driven its poll numbers downward. It was only polling at 44% support, a swing of almost 8% from the 2007 election.
Dawkins had held Ryde without interruption or serious difficulty since its re-creation in 1999. Labor sat on a margin of 10.1%, which would have been considered safe under normal conditions (any seat with a two-party margin greater than 10% is considered safe on paper). However, the seat had historically been marginal at the federal level. Combined with Labor's declining poll numbers, commentators thought it was vulnerable to being taken by the Liberals. The by-election came at a very bad time for the government. In addition to Labor's dwindling poll standing, Dawkins' resignation had touched off a domino effect that ultimately resulted in Premier Morris Iemma leaving politics as well.
On paper, Dominello's victory turned Ryde from a safe Labor seat into a safe Liberal seat in one stroke. At the time, it was the largest swing against a sitting government in New South Wales history; it has since been outdone by the 2010 Penrith by-election (which saw a 25% swing against Labor) and the 2013 Miranda by-election (which saw a 26% swing against the Coalition).