The motion to oust the pro-Western government leader collected only 194 of a required 226 votes in Ukraine's 450-seat parliament.
President Petro Poroshenko had earlier asked Yatsenyuk to resign because he had lost the public's trust in his ability to fight corruption and overcome Ukraine's deep economic malaise.
Recent opinion polls show 70 per cent of Ukrainians supporting Yatsenyuk's ouster and only one percent backing his People's Front parliamentary bloc.
But Yatsenyuk put up a stiff defence of his record, in a passionate address to lawmakers delivered shortly before the vote.
The 41-year-old former banker has been in office since Urkaine's dramatic February 2014 revolution ousted the ex-Soviet country's Russian-backed leader and set it on a westward course.
He was credited with helping negotiate Ukraine's massive Western financial rescue package that helped bolster the government while it was fighting a brutal pro-Russian revolt in the country's separatist east.
"Dear deputies: we now have a country with full state coffers, an armed Ukrainian army, written-off debts, and paid salaries and pensions," Yatsenyuk said.
"We will hand over the country to a new government with honour and dignity," he concluded before parliament decided to keep him in office.
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