Her center-left Democratic United Party garnered 127 seats out of the 300 seats up for grabs in Wednesday's elections, losing the key battle it deemed as a referendum on President Lee Myung-bak and his conservative ruling Saenuri Party.

The ruling party won 152 seats in an upset victory, retaining its parliamentary majority.

"Every effort was made, but we failed to live up to people's expectations," Han said during a press conference. "I intend to step down to take responsibility for our shortcomings."

As a member of the opposition party, she will continue making "excruciating efforts" to win the December presidential election, the former prime minister said.

Her exit came barely three months after she assumed the job amid high expectations the broad coalitions between the liberals and the progressives would easily defeat the scandal-ridden ruling party in key elections this year.

Efforts to form a joint front against the conservatives had galvanized the usually divisive liberal and progressive political forces prior to the polls.

The Democratic United Party, however, was soon beset by infighting and controversies involving its candidates for the general elections, failing to maintain the favorable momentum. The party is expected to elect a new leader in two months.