Michael Portillo quit frontline politics with his ambitions in tatters last night after being dumped from the Tory leadership race.

The final ballot of Tory MPs saw Kenneth Clarke move ahead of Iain Duncan Smith as the two candidates who will face the verdict of Conservative party members.

Mr Portillo announced he would never again seek front bench office in the Conservative Party.

The former front-runner finished a humiliating third in the final ballot, with 53 votes, behind Mr Duncan Smith on 54 and Mr Clarke on 59.

The Kensington and Chelsea MP, with one comeback already behind him, vowed: "I think the time has come for me to look for other things to do."

He said he did not "intend ever again" to seek office on the Conservative front bench.

"I really don't think it's an option for me to serve in a shadow administration," he said.

"Apart from anything else, I'd just get in their way."

Mr Clarke's triumph, piling 20 votes on to his total in last week's MPs' ballot, saw him pull ahead of the latest supposed favourite, Mr Duncan Smith.

The stage is now set for a fight to the finish between the right-winger and Mr Clarke's euro-friendly brand of Conservatism among the 300,000-plus Tory activists who have the last say in the bruising contest.

The result of the one member one vote ballot will be announced on September 12.

Mr Clarke said he was "totally surprised" to hear of Mr Portillo's decision to withdraw from front line politics.

He said: "I am very disappointed to hear that, because he is a big political figure and to be knocked out by one vote is a very cruel blow. I hope he sleeps on it and thinks about it. It would be a great loss."

On his leadership bid, he said: "I am confident, but I have got to justify that confidence by explaining to the members up and down the country why I should be the next leader."

Mr Duncan Smith said he was "relieved and very happy" to have made it through to the final round of voting.

He denied he was at all disappointed to come in second, saying: "All along, wouldn't you have expected either Ken or Michael to win this particular round? They are the ones who are well known and have a track record of ministerial experience."

He said that, despite their differences on Europe, whoever was chosen as leader by the membership could expect the whole party to unite behind him.

He disclosed that he and Mr Clarke had agreed to support one another, whichever was victorious.

Mr Duncan Smith set out how he wanted the campaign to proceed: "Keep it clean. Keep it on the issues and unite round whoever is leader at the end."

Even though Mr Clarke took the most votes in this ballot, bookmaker Coral Eurobet made Mr Duncan Smith 2-5 favourite to win the membership vote. Corals made former chancellor Mr Clarke 7-4 to succeed William Hague.

Meanwhile, Mark Oaten, chairman of the Liberal Democrats, said the contest between Mr Duncan Smith and Mr Clarke could only produce "a Conservative Party which is more divided than ever".