Nick Clegg has launched his bid to be the Liberal Democrat leader by warning his party they face "falling back for good" unless they broaden their appeal.
Mr Clegg pledged to unite the Liberal Democrats
He told an audience in his Sheffield Hallam constituency he wanted to reach millions of people who shared liberal values but who did not vote Lib Dem.
His rival, Chris Huhne, launched his leadership campaign on Wednesday.
Mr Clegg, an early favourite with bookmakers, said the contest was likely to be "a two-horse race".
He said: "My feeling is that it's likely to be Chris and myself as the candidates, I don't think there's anybody else."
Mr Clegg has gained the support of former leader Lord Ashdown and MP Steve Webb, who had been expected to mount a leadership bid of his own.
Mr Clegg, 40, told activists the party has been "caught-up in internal self-analysis" for the past two years.
DECLARED CLEGG BACKERS
"We cannot go on testing the patience of the British people. We must come together now and make a long-term commitment to British Liberalism.
"We must step up or risk falling back for good."
He said the party had to move outside of its "comfort zone" and "take greater risks than ever before".
Mr Clegg paid tribute to former leader Sir Menzies Campbell, saying he had restored credibility to many of the party's policies and had led the opposition to the war in Iraq.
But while he was proud of the party's progress, Mr Clegg said: "We are not where we need to be, not yet."
He pledged to break the "stifling grip of two-party politics" and appeal to "to the millions of people who don't feel they have a voice in British politics at all".
"I want our party to be a gathering point for everyone who wants a different type of politics in Britain," he said.
He said he had launched his campaign in Sheffield because the party wanted to change the "old tired way of Westminster politics".
DECLARED HUHNE BACKERS
Asked about his only declared rival, Mr Huhne, he said they had both been colleagues in the European Parliament and he had "immense admiration" for him.
"This is not a personal beauty contest," he said.
"We will work together whatever happens, this is not about personalities but about a vision."
Mr Huhne, 53, who went to the same public school as Mr Clegg and, like him, was an MEP before entering Parliament in 2005, launched his leadership bid at a Westminster restaurant on Wednesday.
The former economist was the architect the Lib Dems' green tax proposals - elements of which have been copied by both Labour and the Conservatives - and is expected to make the environment a key plank of his campaign.
The leadership was prompted by the surprise resignation of Sir Menzies Campbell on Monday.
A number of other senior figures - including acting leader Vince Cable and MP David Laws - have already ruled themselves out of the running.
Finance spokeswoman Julia Goldsworthy, universities spokeswoman Sarah Teather and work and pensions spokesman Danny Alexander have also pledged their support to Mr Clegg.
Former Lib Dem leader Charles Kennedy has said he will not be endorsing a candidate - and is unlikely to throw his own hat into the ring despite receiving "thousands" of e-mails urging him to do so.
Mr Kennedy insisted he was "content" with his life at present.
"I've had two general elections to lead the party, which has been a great privilege.
"I think I've had my shot," Mr Kennedy told BBC One's Question Time in Bradford, where he received the loudest applause of any guest when the panel was introduced at Thursday's recording.
And Birmingham Yardley MP John Hemming has also ruled himself out of the contest.
He had been sounding out Parliamentary colleagues to see if he could secure the necessary seven nominations, but conceded he had not managed to do so.
In a message on his website, Mr Hemming said he would indicate which candidate he was supporting in due course.