As the declarations continued, the Tories had won a net gain of 48 councils. Labour had lost 30 and the Liberal Democrats had lost 11.

Mr Hague proclaimed the result a "huge advance" for his party.

With more 356 councils declared, the Conservatives had increased their number of seats by 1,342, Labour had lost 1,122 councillors and the Lib Dems were down 97.

Gary O'Donoghue reports on the results in the English local elections

Labour has prided itself that it is on course to take the biggest share of the vote - the first time this century that a government has been ahead of the opposition during mid-term elections.

The Conservatives had been looking to bounce back after the party was hit hard in local government four years ago - the last time the same seats were contested.

The Tory gains are in areas which had until 1995 been their traditional heartlands, including gains from Labour in Bromsgrove and Hertsmere and from the Lib Dems in Worthing.

Michael Ancram: "Making progress"

William Hague's party also gained control in Rushcliffe, Derbyshire Dales, Welwyn Hatfield, Sedgemere, New Forest. Maldon, Broadland, St Edmundsbury, North Somerset and Wychavon

Conservative Party Chairman Michael Ancram said: "We are making progress.

"We are winning all over the country and this is what we set out to do with all our candidates, who have worked immensely hard."

The Lib Dems were celebrating the success of gaining Sheffield after decades of Labour control. Lib Dem leader Paddy Ashdown said the Sheffield result was "great news" for his party.

He said: "After gaining Liverpool last year Sheffield is now the second great British city we control."

Education Secretary David Blunkett, a former leader of Sheffield City Council, himself congratulated the Lib Dems as having performed "extremely well" as they swept his party from power.

The Lib Dems also gained control of Stockport, Berwick-upon-Tweed, South Gloucestershire, Three Rivers and East Cambridgeshire.

Jane Corbin in Sheffield: "This has been a well contested seat"

Many will read the results of Thursday's local government elections as a mid-term verdict on the Labour government.

But analysts were suggesting Labour had suffered less damage in terms of councils lost than expected. The party has held on to Braintree, York, and Trafford.

Sheffield: Lib Dem gain from Labour

Labour's campaigns co-ordinator Margaret Beckett said: "If that is the outcome at the end of tonight, then it will be the first time this century that any government has actually been ahead of the opposition in mid-term elections.

"I am almost frightened to mention it, because it would be such an incredible outcome."

Around 13,000 local government seats were up for grabs in the council elections.

Low turn out

Peter Snow reports on what the expectations are for local council elections

A poll of more than 700 key wards earlier in the night suggested turn out was running at 29%, eight points down on the same wards in 1995.

The Labour Party was expected to suffer most from the low turn out at the polls.

Although counting began in the English elections as soon as polls closed, it will not start for the Scottish and Welsh local elections - apart from five councils in Wales - until Friday morning.

Losses and gains

Labour lost Wyre Forest in the Midlands to no overall control as the Keep Kidderminster Hospital Campaign group gained seven seats.

It also lost Caerphilly and Rhondda, Cynon, Taff in Wales to Plaid Cymru, which gained 76 new seats overall. The Scottish National Party took 10 new seats.

Included in Labour losses were Dover, Lancaster, Kettering, King's Lynn and West Norfolk, Wrexham, Preston, Barrow-in-Furness, Stafford, Selby and Kirklees.

But the party did win control of Wellingborough and Walsall.

The Lib Dems have lost North Wiltshire, North Dorset, Taunton Deane, Pendle, Adur, Cheltenham, Chelsmford, Restormel and Eastbourne to no overall control.

The result of one ward in Colchester was decided by the luck of the draw after the Tory and Lib Dem candidates polled 356 votes each.