Duncan Smith said Mr Blunt was "irrelevant"
Conservative leader Iain Duncan Smith has told the BBC that his party's local election success will be a springboard to restoring them as a real threat to government.
He described Thursday's election gains of more than 560 seats as "very heartening", and said the party's sound policies would help it compete with the "glitz and glamour" of New Labour.
Mr Duncan Smith rejected speculation about his own position and said he was close to completing a "full reform package" to convince the public his party is ready for power.
Earlier, shadow trade secretary Tim Yeo told GMTV the election results gave Mr Duncan Smith another chance to prove himself, although the party still had a "mountain to climb".
Thursday's success was tempered by the resignation of Conservative front bencher Crispin Blunt, who said Mr Duncan Smith was a "handicap" and that he would continue to argue for a change of leadership.
Talking to the Politics Show on BBC1, Mr Duncan Smith said the party had begun to win back support.
If you take away the glamour, you find a government that is failing
He said: "What we have got here is a swing to us of some 7%, which shows that my activists believe that we can win.
"They have gone out, they have fought these
seats, they have delivered a great result."
The next two-and-a-half years would see a serious challenge to the government, with new policies "about change" set to "really invigorate" party members.
'Decent and straight'
Mr Duncan Smith conceded his party had failed to communicate its message to voters, but that he was confident he could change things for the better.
"I want to offer a Conservative Party, led by me, that is decent and straight, that when it says a thing it means it and when it says it is going to deliver, it delivers," he said.
"You can give all the glitz and glamour to Mr Blair and his cohorts but look where it's got them."
He said Labour was facing crises in health, the asylum system and education, with broken promises on taxation.
Mr Duncan Smith said: "If you take away the glamour, you find a government that is failing."
Mr Yeo, a key member of Mr Duncan Smith's team, said Thursday's results should end the whispering campaign against the Tory leader and boost the party as a whole.
He said: "At a time when the government is clearly running into trouble with its own supporters, people are turning back to the Conservatives.
"Of course we have further to go. This is not enough to win us a general election.
"But it is a much bigger step in the direction of winning one than anyone would have thought a year ago."
Mr Yeo said that Mr Duncan Smith should now use his position as a "straightforward, decent, honest
man" to oppose Labour spin and strengthen his leadership.