5am: Cameron and Brown battle for power

Yorkshire Post results service

Downing Street said Mr Brown would seek to remain as Prime Minister and try to form a coalition to run the country even if Labour did not win a majority.

But Mr Cameron said it was clear Labour had "lost its mandate to govern our country".

A TV exit poll predicted the Tories would be the largest party in the new House of Commons, but fall short of having an overall majority.

The BBC/ITV News/Sky News survey forecast the Conservatives would win 305 seats - 21 short of a majority - with Labour on 255 and the Lib Dems on 61.

With 200 results in, that prediction looked to be in line with actual voting.

Mr Brown told constituents at his Kirkcaldy and Cowdenbeath count: "The outcome of this country's vote is not yet known, but my duty to the country, coming out of this election, is to play my part in Britain having a strong, stable and principled government, able to lead Britain into sustained economic recovery."

Downing Street sources said Mr Brown would insist on his right as Prime Minister to try to form an administration even if he did not command the largest party in the Commons.

They said his view was that a majority coalition government would be better at a time of economic uncertainty than a minority administration.

But Mr Cameron told supporters at his count in Witney: "I believe it's already clear that the Labour government has lost its mandate to govern our country.

"I can see also that the Conservative Party is on target to win more seats at this election than we have done at any election in perhaps as long as 80 years."

He added: "What's clear from these results is that the country, our country, wants change. That change is going to require new leadership and we will stand ready to do all we can to help bring that leadership."

Mr Cameron, foreshadowing extensive wrangling over who would form an administration, promised to put the national interest first in the "hours ahead, or perhaps longer than the hours ahead".

Senior Cabinet ministers stressed that deals with the Liberal Democrats were now on the cards as a cliffhanger election unfolded.

But if the exit poll is right, a simple Labour-Lib Dem pact would still not be enough to secure an overall majority, so other parties would also need to be courted.

As the rollercoaster night of results began to unfold, Labour election supremo Lord Mandelson made plain Labour would seek to stay in office.

The Business Secretary told BBC News: "The constitutional conventions are very clear.

"The rules are that if it's a hung parliament, it's not the party with the largest number of seats that has first go - it's the sitting government."

Pressed on whether Labour would seek to do a deal with the Lib Dems to try to hold on to power, he said: "I have no problem in principle in trying to supply this country with a strong and stable government."

He added that it looked as if the country was heading for a "cliffhanger of a result".

Home Secretary Alan Johnson, asked on BBC News if he had any problem in forming a pact with the Liberal Democrats, said: "I have no problem at all.

"If the will of the people is that no party has an overall majority, that's where grown-up, mature politicians have to be.

"I can't see the Lib Dems forming a deal with the Conservatives. I certainly can't see us forming a deal with Conservatives."

The exit poll ratings were a bitter blow for the Lib Dems, who went into the campaign with 63 seats.

If borne out by real results, it would mean the apparent surge in popularity for leader Nick Clegg after the first TV leaders' debates in a British election had failed to translate into Westminster seats.

Lib Dem deputy leader Vince Cable described the outcome of the exit poll as "very strange" and insisted such polls had been "horribly wrong" in the past.

The Conservatives picked up two high-profile scalps as seats showed some sharp swings to the Tories - but with the overall picture still clouded in uncertainty after nearly a third of seats had declared.

They ousted prominent Lib Dem Lembit Opik in Montgomeryshire, with a 13.2% swing to the Conservatives, and Cabinet Office minister and the Prime Minister's former parliamentary aide Angela Smith from Basildon South with a 7.5% swing.

Mr Brown and Mr Cameron began the journey back to London after their counts, where the next stage of the drama will be played out.

Frantic behind-the-scenes talks will dominate the morning if the exit poll is right and the Tories have failed to secure an overall majority.

And although Mr Clegg may be disappointed at the night's results, he may yet be able to secure a referendum on full-blown proportional representation as the price of his support of either of the two other parties.

Chancellor Alistair Darling ruled out going for the Labour leadership if Mr Brown steps down.

When asked if he would consider being a caretaker leader, Mr Darling told BBC Scotland: "Absolutely not, not for five minutes."

He added: "I'm not interested. Gordon is our leader and there isn't a vacancy."