As of 10:30 p.m. (London time), Labour has gained more than 770 council seats, qualifying its performance as a “landslide.” The Conservatives have thus far lost 400 council seats while the Lib Dems have seen more than 300 fly out the window.
BBC projects that Labour will finish with 38 percent of the national vote, with the Tories at about 31 percent and Lib Dems at 16 percent.
Labour Party chief Ed Miliband hailed the results, saying they show that his party is regaining ground and that voters have rejected the austerity programs of Prime Minister David Cameron and his co-horts.
We are a party winning back people's trust, regaining ground, but there is more work to do, Miliband said.
However, voter turnout was very low, at about 32 percent – partially due to rainy weather -- the worst such figure since 2000
Labour has made particularly strong showings in England’s Southeast and Midlands, Scotland and Wales.
The extreme right wing British National Party lost all six council seats they formerly held.
However, former Labour party member George Galloway, who is now in the Respect party, unseated the Labour leader and won five council seats in the heavily Pakistani Muslim city of Bradford in Yorkshire.
Leading Tory officials shrugged off the Labour victory, citing that it was only a mid-term poll.
These are difficult times and there aren't easy answers,” said Cameron.
What we have to do is take the difficult decisions to deal with the debt, deficit and broken economy that we've inherited and we will go on making those decisions and we've got to do the right thing for our country.
Deputy Prime Minister and Lib Dem leader Nick Clegg said: I am determined that we will continue to play our role in rescuing, repairing and reforming the British economy. It's not an easy job and it can't be done overnight but our duty is to boost jobs and investment and to restore a sense of hope and optimism to our country.
The election for London Mayor is undecided, but according to early indications, the conservative Boris Johnson is running ahead of Labour’s Ken Livingstone, 45 percent to 39 percent.