The pro-EU Liberal Democrats and the Greens capitalised on their demands for second Brexit vote and made major gains in an election dominated by debates over Britain's place in Europe.
The poll was held against the backdrop of political disarray in the UK that saw Prime Minister Theresa May announce her resignation after failing to deliver Brexit on time.
Farage hailed the result and demanded for his Brexit Party to be included in a new round of negotiations with Brussels.
The original 2016 Brexit campaign figurehead warned that failure to leave the EU on October 31 -- the latest Brexit deadline -- would see his party replicate its victory in a general election.
"We are getting ready for it," Farage warned in Southampton as ballots were being counted his the South East region.
Britain voted to leave the EU by a 52-48 per cent margin in a seismic 2016 national poll.
Race to replace May leaves Brexit in limbo
It was supposed to have left the EU on March 29 but got held up by parliamentary deadlock and deep divisions over strategy in May's government.
Farage's newly-formed group capitalised on the anger of Brexit voters in dramatic style.
Results with 90 per cent of the vote the count showed the Brexit Party winning with 31.6 per cent.
May's bickering Conservative Party -- now in the throes of a leadership contest involving much of her current cabinet -- did as poorly as many of its leaders had feared.
The partial results showed them on 9.1 per cent and trailing in fifth place behind the Greens in fourth on 12.1 and double the 2014 EU election outcome.
Vince Cable's pro-EU Liberal Democrats surged to 20.3 per cent from 6.7 percent in 2014 and were well ahead of the 14.1 per cent of the main opposition party Labour Party of socialist Jeremy Corbyn.
The Labour leader has been deeply ambiguous on Brexit for much of the past year.
The Conservatives knew they were facing a drubbing and barely bothered to campaign.
But Labour was also punished for refusing to spell out whether it still wanted Britain to be in or out of the EU.
Labour lost to the Liberal Democrats in the borough of Islington in London that Corbyn represents in the UK parliament.
And the Conservatives were beaten by the Brexit Party and the Liberal Democrats in May's Windsor and Maidenhead constituency in England's South East.
Labour also collected less than half the votes of the surging Brexit Party in Wales, where the party had lost just once since 1918.
"This issue will have to go back to the people, whether through a general election or a public vote," Corbyn said in a statement.
"Labour will bring our divided country together so we can end austerity and tackle inequality," he said.
Neither party had a clear European election campaign platform -- unlike Farage's call for a split from the EU at any cost and the Liberal Democrats' open desire to stop the process in its tracks.
"There is a clear lesson for Labour in tonight's results: get off the fence," Liberal Democrats leader Vince Cable said in a statement
"In trying to please everybody they have pleased nobody."
The Conservatives must now decide what they intend to do about the long-suffering EU withdrawal deal May reached with Brussels last year.
Parliament rejected the pact three times and was on course to do so again before May quit.
The EU refuses to re-open its text and Conservative leadership favourites such as Boris Johnson want Britain to leave with or without a deal when the twice-delayed departure date arrives on October 31.
"No one sensible would aim exclusively for a no-deal outcome," Johnson wrote in Monday's edition of his weekly column in The Daily Telegraph.
"No one responsible would take no-deal off the table."
Some analysts think the results will force the other UK leadership hopefuls to adopt the same tough line.
"Any swing away from the Conservative Party is being interpreted by pretty much all the party leadership candidates as a push toward a harder, serious, no-deal Brexit," University of Bedfordshire professor Stephen Barber told AFP.
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