Tony Blair won an historic second Labour landslide on Thursday, but a dramatic fall in turnout took the gloss off his triumph in Britain's general election.

William Hague, the Conservative party leader, conceded defeat in a brief telephone call to Mr Blair after Labour passed the 330-mark needed for an overall majority at 3am.

In his Yorkshire constituency of Richmond, Mr Hague described the election result as "deeply disappointing" and said the Conservatives must "review, redouble and intensify our efforts to provide an alternative government for the country". He would set out his views today on how that process should begin.

With more than four-fifths of results declared, the BBC was forecasting a majority of 167 seats in the 659-member House of Commons compared with the 179-seat margin Mr Blair won in 1997.

Turnout appeared to be about 58 per cent compared with 71.5 per cent last time - lower than at any time since 1918.

Labour was expected to have 413 seats (down six), the Tories 168 (up three) and the Liberal Democrats 50 (up four).

Mr Blair said it was an "extraordinary thing" that "tonight the Labour party for the first time in our 100 years of history looks as if we may be on the verge of a second successive term of office".

But he said Labour must show "absolute humility" in the face of work still to be done to reform health, education, transport and the criminal justice system.

Labour attempted to quash claims that the low turnout weakened the prime minister's mandate. Gordon Brown, chancellor of the exchequer, said there was public "enthusiasm" for a second Labour term.

The party was seeking a convincing mandate to drive through reform in public services in the face of potential opposition from trade unions and interest groups.

And despite the low turnout, Mr Blair's majority may strengthen his hand in the most difficult decision his government will face: whether to call a referendum on joining the euro.

Eight pro-euro businessmen led by Lord Marshall, chairman of British Airways, said it gave him a mandate "to lead a great national debate on Europe and the single currency".

The Liberal Democrats took Guildford, Teignbridge, Cheadle and Mid Dorset from the Tories and increased majorities in Torbay and Kingston and Surbiton. They also won Chesterfield, Tony Benn's former seat, from Labour.

Peter Mandelson, the former cabinet minister, was almost in tears as he held his Hartlepool seat with a 14,500 majority. Shaun Woodward, the Tory defector, won St Helens South but with 14,000 fewer votes.

The Tories regained Tatton, Neil Hamilton's former seat taken in 1997 by Martin Bell, the independent. Mr Bell failed narrowly to take Brentwood and Ongar from the Conservatives.

There was a warning to Labour over health when Richard Taylor, a doctor campaigning as an independent against a hospital closure, won Wyre Forest by 17,000 votes from Labour's David Lock, a junior minister.

There was one consolation for the Tories when they won Galloway and Upper Nithsdale from the Scottish National party, giving them a Scottish seat after the wipeout of 1997.

Charles Kennedy, the Liberal Democrat leader, said it was "doubly historic" that his party was building on its gains in 1997.

Michael Portillo, shadow chancellor, defended his party's campaign, saying it would have been foolish to fight on ground on which Labour had an advantage.

Ann Widdecombe, shadow home secretary and like Mr Portillo a potential leadership contender, said: "We fought an excellent campaign."