By Rob Taylor and Robb M. Stewart 

A state-election mauling delivered a setback to Australia's embattled prime minister, Tony Abbott, with voters in Queensland adding to an anti-conservative mood threatening his leadership ahead of national elections next year.

With his ruling Liberal-National coalition already unpopular over tax increases and austerity cuts to health and education, voters in Australia's conservative-leaning region moved sharply against their state government on Saturday. Still, as votes continued to be counted early Sunday morning, it remained unclear whether the opposition Labor would win enough seats to form a government without support.

After delivering Labor its biggest ever defeat in 2012, Queensland voters swung sharply back behind the left-leaning party and spilled conservative Premier Campbell Newman from his seat in Ashgrove, which encompasses several suburbs in the state capital, Brisbane.

Labor had secured at least 43 of 89 seats to the Liberal-National's 40, with about 30% of the vote still to be counted. That marked a significant turnabout from the 9 seats Labor had held, including 2 seats picked up in by-elections since 2012, but shy of the 45 needed to form the next government outright.

"It's over," Mr. Newman told party members in a broadcast speech. "The times we are living in are uncertain. I had to make tough decisions, but they were necessary, and I do truly believe they put Queensland in a far, far better place," he said.

He said he was now bowing out of politics after his seat was returned to Labor's Kate Jones, a reversal of the 2012 result, and his party would meet soon to select a new leader.

Mr. Abbott had stayed out of the tropical northeast state during campaigning to avoid drawing voters' focus to national issues, as well as his own unpopularity. Mr. Newman's state campaign had been dominated by law and crime issues, cuts to health spending and a controversial privatization program that aims to raise 37 billion Australian dollars (US$29 billion) through state port and power asset sales.

Two other Australian states, Victoria and South Australia, have rejected conservative governments since Mr. Abbott swept to power in September 2013, while the weak center-right position is likely to cost seats in a March election covering New South Wales state, centered on Sydney and home to a third of the nation's population of 23 million.

While Mr. Abbott had argued state and national matters were separate, many of the policies that drove the Queensland backlash reflected voter worries nationally, including rising living costs that had made the state the worst in Australia for home-loan repayment delinquencies, as well as cuts to health services.

"There were certainly federal factors," Queensland Treasurer Tim Nicholls said, pointing in particular to discussions over taxes and Mr. Abbott's decision to award a knighthood to Britain's Prince Philip, which "was certainly out of left field for everyone."

Mr. Abbott wants Australians generally to pay more for doctor visits under the country's system of universal health care. The conservatives also want government-owned assets sold to help pay down debt and fund infrastructure as the A$1.5 trillion economy struggles to adjust to collapsing global commodity prices and the end of a mining boom hitting revenues.

But the prime minister's absence couldn't avert an outcome in Queensland that will embolden opponents ahead of parliament sitting next month, which will be dominated by arguments over austerity policies blocked by lawmakers and left over from the government's first budget last May.

"If you care about jobs, if you care about health care, and if you care about education, and you are alarmed at the terrible decisions the [conservative] government is making nationally, then you need to have a champion in your corner at the state level," Labor opposition leader Bill Shorten said Thursday as Queensland campaigning wound up.

Queensland's Labor had appealed to voters to reject asset sales, capitalizing on worries among electors at home and across the country that private ownership and a push for profits would drive up living costs and see jobs cut. Queensland's 6.6% unemployment rate is already higher than the national average of 6.1%.

"The people of Queensland sent a very clear message, and that message was they do not want their assets sold," state Labor Leader Annastacia Palaszczuk said. "We will keep our assets in public hands for future generations." Similar arguments against asset sales and costly new infrastructure projects helped Labor to win elections in Victoria state last November.

Mr. Abbott spent election eve Friday almost as far from Queensland as he could get, among dairy farmers in the country's bucolic southeast, and insisted he would lead the country to the election next year, despite growing disquiet over a bulldozing leadership style that has upset voters, political opponents and some of his own lawmakers alike.

"They have got a very good captain," he said. "It takes a good captain to help all the players of a team to excel."

The government's popularity since the budget has hovered near record lows. A major Roy Morgan poll on Thursday found Labor had a 55.5% to 44.5% lead over the conservatives, which, if confirmed at elections, would deliver a landslide victory to Mr. Shorten and 95 seats in the 150-seat lower house.

Mr. Abbott was last week forced to defend his record and to douse speculation that he could be dumped by his colleagues, who are angry over a decision to appoint the husband of Queen Elizabeth II a knight of the Order of Australia, as well as worried about being swept from power after just one three-year term.

Jane Prentice, a federal Liberal-National member of parliament said conservatives would be worried by the vote in Queensland and had lessons to learn. "It's clear we're not getting the message out. We need to examine what we are doing," she said.

Former Labor Treasurer and Deputy Prime Minister Wayne Swan, whose government was ousted by Mr. Abbott's conservatives in 2013, said the vote was a referendum on the conservatives in Queensland and across Australia.

"People used to talk about voters waiting with baseball bats. Well, they have been waiting out there in Queensland with sledgehammers," Mr. Swan said. "It's the misplaced austerity, the unnecessary talk of debt and deficit disasters, the savage cuts to health and education. People are fed up with that."