Prime Minister Gordon Brown has said Labour "will recover" after its worst local election results in 40 years, and told the BBC he took the blame.
"I feel responsible. There are no excuses on my part at all," he told BBC One's Andrew Marr Show.
He admitted to some mistakes but said he had the "conviction and ideas" to take the country forward.
For the Tories, Liam Fox said Mr Brown was "caught in a mental rut" and should "stop patronising" voters.
Labour's poor local election results - in which their projected share of the national vote dropped to 24%, pushing them into third place behind the Lib Dems - were topped by Ken Livingstone's defeat by Conservative Boris Johnson in London's mayoral race.
In his first interview after the results were announced, Mr Brown said it had "not been the best weekend", adding that voters were worried about rising petrol and food prices and utility bills.
I'm not going to be put off by a few days' headlines from the job that I'm determined to do for this country
"I do understand this and I feel the hurt that they feel," he said.
But he told the BBC: "Of course we can recover from this position and I'll tell you how.
"First of all by sorting out the immediate problem with the economy and showing people we can come through as we have in the past very difficult economic times.
"Secondly by showing people that we have the vision of the future that will carry this country optimistically in my view into its next phase."
Labour suffered a net loss of 331 seats in local elections in England and Wales on 1 May. Mr Brown said he would be "taking the fight to the Conservative Party" over the next few months, which he said was "slick" and "impressive in its salesmanship" but short on substance.
I think if that was a fight-back, Gordon Brown is now in deeper water
He acknowledged he had made mistakes over the decision to axe the 10p tax rate, spending "too little time" thinking about getting his message across to the public and allowing speculation about a possible early general election "go too long".
But he added: "I'm resolute and determined, and I've got convictions and ideas, and I'm not going to be put off by a few days' headlines from the job that I'm determined to do for this country."
Asked if Labour was now the underdog, he replied: "If we are the underdog, we are certainly fighting and we are fighting hard."
Left-wing MP John Cruddas wrote in an article in the Sunday Mirror that the party was "sinking fast" and working-class voters felt "let down" as Labour sought the middle-class vote.
And various newspapers have speculated about plans to oust Mr Brown as Labour leader - but the prime minister told the BBC: "I don't believe many MPs are saying that".
Left-wing Labour MP John McDonnell denied he was considering a possible "stalking horse" leadership challenge but told the BBC the whole cabinet should consider their positions if they could not turn the party around within six months.
But Labour's deputy leader Harriet Harman said voters did not want Labour to look "inwards to ourselves" and said Mr Brown was "the very best placed person" to lead the country through economic turbulence.
Liberal Democrat Vince Cable says Gordon Brown is down but not out
And Foreign Secretary David Miliband, who has been tipped as a future Labour leader, said Mr Brown was "the right man to take us forward into the next general election" and urged the party to pull together.
He also said the whole cabinet should take responsibility for the "big beating" Labour took in the local elections.
Environment Secretary Hilary Benn said he had supported Mr Brown last year to be party leader because he had believed he was "the right person to lead the party and the country", adding that his view had not changed.
He said: "Our job now is to support him; to work together to meet the challenges that lie ahead; to show that we have listened in the policies that we pursue.
"He represents the qualities that we need. He thinks deeply, he cares passionately and his record shows that he takes the right decisions," said Mr Benn.
Gordon Brown had given his backing to Ken Livingstone
Labour backbencher Diane Abbott told Sky News it would be "madness" to remove Mr Brown as leader less than 18 months before an election.
Earlier, shadow defence secretary Liam Fox told the BBC Mr Brown was "caught in a mental rut" by repeatedly claiming a record of economic stability at a time when families were being hit by rising prices.
He said government needed to "stop patronising them by telling them they have got economic stability when to ordinary families they don't".
Shadow business secretary Alan Duncan told Sky News: "I think if that was a fight-back, Gordon Brown is now in deeper water."
Liberal Democrat home affairs spokesman Chris Huhne said the Labour Party was "in some turmoil", but as 71 Labour MPs would need to call for his resignation to trigger a leadership election he thought it likely Mr Brown would lead the party into the next general election.
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