Prime Minister Tony Blair's (search) governing Labour Party (search) lost a parliamentary seat to an anti-war party and narrowly avoided defeat, according to vote results Friday.

The result is a further blow for Blair, whose popularity has slumped since the Iraq war. Labour fared terribly in local council and European Parliament (search) elections last month and some in the party question whether Blair, once their most prized electoral asset, has become a liability.

The Liberal Democrats, who strongly opposed the war in Iraq, finished first in Thursday's balloting with 10,274 votes in Leicester, a city in central Englcond with 8,620 votes and the Conservative Party had 5,796. Labour narrowly held onto another parliamentary seat, in the nearby city of Birmingham.

The two by-elections followed the publication Wednesday of a report exposing widespread British intelligence failures on Iraqi weapons of mass destruction.

The new Liberal Democrat lawmaker for the Leicester South constituency, Parmjit Singh Gill, said voters had given their verdict on the war.

"The claims about weapons of mass destruction were exaggerated," he said in his victory speech. "The justification which Tony Blair gave for backing George Bush was wrong. Their message is that the prime minister has abused and lost their trust."

Blair's Health Minister John Reid conceded that some voters were unhappy about the war.

"I have not denied there is an element of protest in the results, nor have I denied that we have got to listen to what has been said. All I have said is that it is not entirely about Iraq," he told the British Broadcasting Corp.