There is shock and surprise after the former foreign secretary, who catapulted ahead after Tory conference, is eliminated from the contest.
Tory MPs held a final vote on Wednesday to reduce the field to a final two, who will then go to a ballot of Conservative members.
After picking up 42 votes in the final round of voting, Ms Badenoch re-established herself as the favourite after lagging behind in previous rounds.
Robert Jenrick, her close rival on the right, picked up one vote shy of Ms Badenoch, while Mr Cleverly - who was seen as a unifying candidate - won the backing of 37 MPs.
More at https://news.sky.com/story/tory-leadership-race-james-cleverly-knocked-out-leaving-robert-jenrick-and-kemi-badenoch-as-final-two-facing-party-membership-vote-13230871