Ministers should kill off their whole regional devolution project now the North East has rejected plans for an elected assembly, say the Tories.
It was a bad night for Deputy Prime Minister John Prescott
The plan for a new assembly was voted down by 696,519 (78%) to 197,310 (22%) in the referendum on Thursday night.
Deputy Prime Minister John Prescott has admitted his devolution plan have suffered an "emphatic defeat".
Now the Conservatives are urging him to scrap the unelected regional chambers which are already in place.
Tory spokeswoman Caroline Spelman said the chambers cost £30m a year and had always been a forerunner for elected assemblies.
"The English people identify with their nation, and their cities, counties, boroughs and neighbourhoods, not with the government office regions," she said.
Policies on planning and housing should be decided by local councils, not regional bodies, she added.
The demand received short shrift from the government, which says it will continue to use regional bodies to improve the economy and quality of life in the regions.
Official figures showed 47.8% of the North East's 1.9 million voters took part in the all-postal assembly referendum.
At a late night news conference, Mr Prescott said: "The North East public have answered in an emphatic way. I am a democrat and I accept that.
"I was surprised by the clear majority and I think there was a number of reasons for that - and claims of more politicians and greater council tax has an effect."
His deputy, Nick Raynsford, said Wales now had devolution despite the idea being defeated by an 80-20 margin in 1979.
"So things can change," he said.
Mr Raynsford said ministers would reflect on the result and refused to rule out holding two further referendums in Yorkshire and the Humber and the North West.
"No" campaigner John Elliott was delighted with the result
But London Mayor Ken Livingstone, who travelled to the North East to back the yes campaign, said the vote was a major blow for British devolution.
"It seems likely that only London, of all the English regions, will now benefit from devolution," said Mr Livingstone.
John Elliott, chairman of the North East Says No campaign, said the result was a victory for ordinary voters against the local "political establishment", who had backed it.
He said: "I'm not interested in giving the government a bloody nose - I am sure they are honourable people.
"But I would rather John Prescott has two weeks' embarrassment than us be saddled with a £25m white elephant."
Liberal Democrat regions spokesman Ed Davey suggested the result might have been different if the government had promised the assembly more powers.
There was still a need for power to be devolved from Whitehall, he said, and more thinking was needed about the best way to do it.
Merseyside Labour MP George Howarth said the North East referendum showed voters had "no appetite" for assemblies based on areas they do not identify with.
The government believes elected assemblies would give a voice to regions distant from Westminster and return power to local people from the non-elected bodies that oversee many services.
But anti-regional assembly campaigners argued the new tier of government would be an expensive talking shop with very little real power.
BBC political editor Andrew Marr said many in the No Camp were Eurosceptic campaigners and ministers would need to reflect on the lessons for its referendum on the new European constitution.