It was a mixed night for Labour in the Welsh assembly election, but the party could still hold on to power.
Labour saw their seat total fall to 26, while there were gains for Plaid Cymru, who now have 15 seats, and the Conservatives, who have 12 AMs.
It leaves Labour well short of a majority in the 60-member assembly.
The Welsh Liberal Democrats said it was "clear that the people of Wales have decided that no one party should command a majority in the assembly".
First Minister Rhodri Morgan, who had said he would resign if Labour did badly, said the party had "proved the doom-mongers wrong" and "we can hold our heads up high".
Mr Morgan said it was a night when Labour "haven't won but haven't exactly lost" but there was "a shade of grey in the middle."
He said it was a time for discussion within the party and he did not expect anything to emerge until after the bank holiday.
"I don't think it will be today, the groups have got to get together and discuss the best way forward."
Prime Minister Tony Blair said the results were not as bad as many people expected and that he had expected to lose some seats.
"In Wales, we are going to retain control and be the largest party and be the government," he said.
Plaid's Rhodri Glyn Thomas, the re-elected AM for Carmarthen East and Dinefwr, said the party had "had some very good results".
He said that "some hard talking" would take place over the weekend
Minister Alun Pugh was beaten by Conservative Darren Millar
"We will be looking at the situation which faces us - obviously we will want to play our part in the future of the assembly," he said.
"The electors have told us they don't want a single party with a majority. We are all going to have to address that."
Earlier, Plaid leader Ieuan Wyn Jones had said that he would not work under a Tory first minister or prop up a minority Labour one, but added that, "if an agreement can be reached, I'm ready to speak".
Nick Bourne, leader of the Welsh Conservatives, said he was celebrating after the party increased its number of seats.
"We're the only party who have gone up in two successive assembly elections," he said.
"It's devastating for Labour to have the lowest share of the vote since the First World War," he added.
Mr Bourne also said that he did not think any coalition deals would be formed on Friday because "everybody's a bit tired".
Mike German, assembly leader of the Welsh Liberal Democrats said: "Wales' experience is that stable government is more effective than the alternative.
"The 'partnership government' offered clearer direction, and leadership to Wales, than the drift and muddle that have characterised Labour's minority administration."
After most results were declared, Labour was on about 32% of the vote, Plaid 23%, Conservative 20%, and Lib Dem 16%. Labour's Welsh vote was its worst since World War I.
Labour's vote was down 8.5%, while Plaid and Tories were up between 1% - 2% and Lib Dems up about 1%.
Turnout was also up, at about 43%, from 38% four years ago.
Independent Trish Law celebrates after retaining Blaenau Gwent
Plaid's Helen Mary Jones turned a Labour majority of 21 in Llanelli into a 3,884 winning margin of her own. And Plaid Cymru's Elin Jones retained Ceredigion despite a strong Lib Dem challenge.
Meanwhile, the assembly has its first ethnic minority member. Plaid Cymru's Mohammad Asghar - known affectionately as Oscar - was elected via the South Wales East list.
The Conservatives took a series of seats from Labour: Clwyd West, Preseli Pembrokeshire, Carmarthen West and South Pembrokeshire, and Cardiff North.
Clwyd West provided the biggest casualty of the night when Culture Minister Alun Pugh lost his seat to Tory Darren Millar.
Labour was also again beaten by independent Trish Law in its former valley heartland seat of Blaenau Gwent.
But the party held onto Caerphilly, despite a challenge from former Welsh Secretary Ron Davies, standing as an independent in his old constituency, and a strong Plaid Cymru showing.
It also enjoyed a valuable victory when Lesley Griffiths won back Wrexham from independent John Marek, a former Labour MP and AM.
Elsewhere, Lib Dem Jenny Randerson held onto Cardiff Central with 51% of the vote.
However, the British National Party (BNP) came within 2,580 votes of winning a north Wales regional seat in the Welsh assembly election, winning 9.4% of regional vote in Wrexham, which has a large Polish community.