David Cameron warned Gordon Brown not to try to "cling to power" after the Tories made gains from Labour but not enough to form a majority at Westminster.
Speaking at 3am after the count for his own Witney, Oxfordshire, seat, Mr Cameron sounded subdued but called for Mr Brown to go to make way for new leadership and stable government. "Nationally, we have to wait for the full results to come out. I believe it is already clear that the Labour Government has lost its mandate to govern our country," said Mr Cameron.
"Although there are still many more results to come, it looks as though the Conservative Party is on target to win more seats than it has done for 80 years. What is clear from these results is that our country wants change. That change is going to require new leadership."
In the opening salvos of a battle of wills over who rules Britain in a hung parliament, the Conservative leader and his Shadow Cabinet angrily criticised Labour ministers for claiming they could do a deal with Liberal Democrat leader Nick Clegg to remain in office.
Mr Cameron hinted that he expected difficult horse-trading ahead before a government emerged. He said: "What will guide me in the hours ahead, and perhaps longer than the hours ahead, will be the national interest – to do what is right for our country, to make sure we have that government, have that stability, take the right decisions.
"We live in difficult times but this is a great country and we will come through them and be stronger.
"At all times what I will do is put the national interest first to make sure we have good, strong, stable government for our country."
Mr Cameron briefly visited party workers at the New Inn pub with his wife, Samantha, in his Witney, Oxfordshire, constituency, before going to the count and then travelling back to London to meet up with party workers and senior aides at the Conservative Party headquarters at Millbank Tower, where Labour celebrated victory 13 years ago. A Tory source described Mr Brown's determination to hold on to power as "breathtaking". He added: "Brown has never won a general election, looks set to lose a record number of seats, but still tries to cling to power."
Mr Cameron was given fresh hope of forming a majority, after the Tories made a string of gains, starting with Kingswood, near Bristol, where they overturned Labour's majority of 6,145 and unseated Roger Berry with a swing of 9.4 per cent. A Tory spokesman said: "Kingswood is just the sort of seat the Conservatives need to win an overall majority." As more Labour seats tumbled to the Tories, the Conservatives also took highly marginal Battersea, south London, previously held by Martin Linton for Labour with a majority of just 163.
However, the Tories failed to gain some of their targets including Torbay in the South-west, Tooting in London, and Angus which was held by the SNP. In a patchy performance, the Tories won Gainsborough, and the 99th target seat on the Tory list, Dover, from Labour, but failed to make any inroads in Labour-held Gedling.
One of Mr Cameron's biggest disappointments of the night came with the Tories' failure to gain Bolton North East from Labour. Mr Cameron took his campaign battlebus twice to the town, where local bakers, Wharburtons, made a £25,000 donation to Tory party funds. But the Tories did win Carlisle from Labour with a 7.7 per cent swing.
The Tories claimed a scalp when they took back Basildon South – one of the seats that produced "Essex Man" in the Thatcher era – by unseating Angela Smith, a parliamentary aide to Mr Brown. In Wales, the Tories took Aberconwy and Vale of Glamorgan from Labour and Liberal Democrat Lembit Opik's Montgomeryshire seat.
The Tories were delighted to win back High Peak in the Peak District. Dartford formerly held by Labour's Howard Stoate, a GP, was also taken back by the Tories.
Last night as the inquest started into why the Tories had not made more gains on their target list, questions were being asked about the impact of the millions of pounds poured into the battle for the marginal seats by Lord Ashcroft, the controversial "non-dom" Tory peer.
Mr Cameron was disappointed by the first exit poll predicting he would not reach the magic total of 326 seats to give him a majority, but he led Shadow Cabinet ministers in mounting a barrage against claims by Foreign Secretary David Miliband, Lord Mandelson and other ministers to have a mandate to continue in power by doing a deal with Nick Clegg.
The shadow Chancellor, George Osborne, told ITV News: "I think Labour politicians like David Miliband need to get real. The election has taken place and on the basis of the exit poll the Labour Party has been decisively rejected." He went on: "The idea that Gordon Brown, David Miliband and the rest of them could cling on to power I think most people would find simply staggering."
Mr Cameron's aides said the exit poll predicting the Tories would win 305 seats would still "a basis to govern".