Thaksin's Thai Rak Thai (Thais Love Thais) party scored an overwhelming victory in Sunday's elections, but failed to win a single seat in four southern provinces.
Thaksin told reporters: "Thai Rak Thai did not lose the south because of our policies. We lost, first of all, because of delays in the process undertaken to solve those (polling) problems."
"Secondly, people in the south mistrust authorities because of past mistakes, like the killings," referring to the insurgency and the death of about 80 demonstrators by suffocation, while in police custody, earlier this year.
"And third, local authorities are not patient enough in dealing with the insurgents. These problems take time to resolve," he said.
Voters surveyed the week of the election in a poll released on Wednesday gave Thaksin generally high marks, with an approval rating of 77%.
But his handling of the south topped the list of voters' worries, with 55% saying his policies in the south had weakened their trust in government, according to Assumption University pollsters.
Finance minister to resign
Unofficial results compiled by a pool of local media, with 78% of ballots counted by Wednesday evening, showed TRT with 376 seats nationwide.
Rival Democrats had 94 seats, current TRT coalition partner
Chart Thai 26, and the newly formed Mahachon party one seat.
About 80 demonstrators had died
of suffocation while in custody
Thaksin has yet to announce his new cabinet, but Finance Minister Somkid Jatusripitak told reporters he would step down when Thaksin forms his new government.
Somkid said he would like to keep his portfolio as deputy prime minister for economics, the government's top economic policy job.
Ballots have been counted in 90% of constituencies and winners have been determined in three quarters of them, but no official results will be announced until Friday at the earliest, Election Commission (EC) secretary general Ekkachai Varunprapa said.
"The Election Commission has received results from 300 constituencies, and we expect another 97 tonight," Ekkachai told reporters.
"Three constituencies are holding reruns of the balloting on Wednesday, and those results should be known within a few days," he said.
"If we receive no complaints, the EC is expected to announce the first round of results by Friday."
Four polling stations in three constituencies were conducting re-runs of Sunday's vote after election officials found irregularities that called into question the validity of the first vote.
One polling station was outside Bangkok, but three were in the southern provinces where Thaksin's government has battled an insurgency since January 2004.
No violence was reported on election day, but on Monday a provincial defence officer was shot dead by two men riding a motorbike in the town of Rangae, police in southernmost Narathiwat province said.
Governor says high voter turnout
made Narathiwat a success
In a Thai radio report the governor of Narathiwat province, Pracha Terat said the election had proven a great success for Narathiwat, with high voter turnout in the province.
Pracha also said that the opposition would not hinder the peace process in the province and urged the new government to quickly address the ongoing problems in the southern most region, especially in terms of education and security problems.
Human rights groups and community leaders have criticised Thaksin's heavy-handed response in the south, notably two controversial incidents, one that left hundreds of protesters dead by suffocation while in detention.