LONDON, NOV. 20 -- Prime Minister Margaret Thatcher suffered the worst political defeat of her 11 years as head of Britain's government today, outpolling challenger Michael Heseltine in a contest for leadership of the ruling Conservative Party but failing to win enough votes to avoid a second round of balloting.
Within minutes of hearing the result and without consulting any other party leaders, a defiant Thatcher announced she would stay in the race for the second round next Tuesday, setting the stage for yet another damaging week of political turmoil and recrimination that already has deeply wounded Thatcher and her bitterly divided party.
Her swift response from Paris, where she is attending the 34-nation summit on European security, was seen by analysts here as an attempt to foreclose the possibility that a compromise third candidate might emerge from within her own cabinet, and it set up another showdown between her and Heseltine, her former defense secretary and now her relentless rival.
The vote by Conservative Party members of the House of Commons capped a whirlwind five-day campaign chiefly notable for venomous verbal attacks and counterattacks that show no sign of abating in the days and weeks to come.
"Eleven years is long enough in power for anybody. She's passed her sell-by date, and she ought to go now," said Conservative lawmaker Anthony Beaumont-Dark tonight. Beaumont-Dark, a member of a coalition of maverick legislators and disgruntled former Thatcher loyalists who had lobbied for Heseltine, called on Thatcher to step down before the second vote, saying, "I am sick and tired of overweening politicians who try to hang onto power at the expense of the party and the country."
Thatcher backers were not to be outdone. Nicholas Fairbairn, an ardent Thatcherite, called Heseltine "junk jewelry" and described his supporters as "a band of bandits who are malcontents." "Good God," Fairbairn said, "if you look at their names you couldn't form a government of the dead."
But despite such fanatical expressions of support, political analysts here said that senior Tories -- known as "the men in gray suits" -- will face the unpleasant task over the next day or so of deciding whether they should send a deputation to 10 Downing Street to try to persuade Thatcher to resign. Even if she wins next Tuesday, many observers believe today's pyrrhic victory makes her political demise inevitable. "I think Mrs. Thatcher is so badly damaged now that she will not be prime minister by the summer of next year," said John Cole, the highly respected chief political editor of the British Broadcasting Corp.
The 372-member Conservative Parliamentary caucus gave Thatcher 204 votes and Heseltine 152, while 16 members abstained -- a tally that left her four votes short of the 15 percent margin over her rival that the party's complex rules require in first-round balloting. In the second round, a simple majority of the caucus will suffice, but Thatcher will need to hold on to her supporters against an opponent who may gain momentum from his showing today. As leader of the majority party, the winner automatically will serve as prime minister.
Thatcher lieutenants, who believed they had pledges of support from 230 lawmakers before the voting began, indicated tonight that waverers can expect intense new pressure to fall in line behind a prime minister who has led them to three straight national election victories.
Many supporters of the prime minister sought to put the best face on the result, noting that she had gotten about 55 percent of the vote and predicting an easy win next week. But Cecil Parkinson, a former party chairman and a close ally of Thatcher, disclosed the private gloom behind the public smile, conceding: "The result was as bad as it could be for the party as a whole, and it gives our opponents another wonderful week of watching us divide ourselves."
Heseltine, who won at least 20 more votes than most analysts had predicted when he announced his candidacy last week, said he was "overwhelmed with gratitude" to his parliamentary colleagues and declared that he, too, would remain a candidate in the second round.
Some Conservative lawmakers said they would like to see Thatcher step aside and allow a more centrist candidate, such as Foreign Secretary Douglas Hurd, take her place. But Hurd made clear tonight he would not run so long as Thatcher remained in the contest. "The prime minister continues to have my full support, and I'm sorry that this destructive, unnecessary contest should be prolonged in this way," he said. Another senior cabinet secretary, Chancellor of the Exchequer John Major, said he also would continue to support Thatcher.
The deadline for nominees for the next round is noon Thursday. If there is no winner next Tuesday, the contest will go to a third and final round two days later.
The real victor tonight may have been the opposition Labor Party, which has watched with undisguised glee as the Tories have torn themselves apart over the leadership issue. Labor Party leader Neil Kinnock today introduced a motion of no confidence in the government, ensuring a bruising round of parliamentary debate over Thatcher's policies before the end of the week.
"This vote has made it very clear that the government is very deeply divided and incurably disabled; in a phrase, not fit to rule," Kinnock declared, and he called for an immediate national election.
During the tumultuous vote campaign, Heseltine, a 57-year-old millionaire publisher, sought to paint Thatcher as a political liability to her party whose continued leadership would inevitably result in a Labor victory in the next election. He hammered away especially hard at the so-called poll tax, Thatcher's new and highly unpopular system of local taxation, suggesting he could reduce taxpayers' bills by at least one-third by transferring the costs of teacher's salaries to the central government.
Heseltine avoided a direct personal attack on Thatcher, speaking instead of the need for consensus and "cabinet government" -- code words for the sense among many Tories that Thatcher had become strident and dictatorial in her 11 years in power.
Thatcher at first adopted a serene, elevated posture, leaving it to surrogates to attack the challenger. She scrapped that tactic over the weekend, however, and weighed in with scathing attacks on Heseltine, alleging he was an "economic interventionist" and "closet leftist" who would dismantle the unswerving free-market structure of Thatcherism.