He said he would call a special parliamentary session, as is customary after an election, and then reshuffle his cabinet "at an appropriate timing".
"The voice of the people is saying 'renew personnel completely'," he said, adding that he had the "responsibility in appointing cabinet members".
Despite the dismal showing in his first poll test, Abe had said on Sunday he would not step down as his "task of nation-building has just begun".
Previous Japanese prime ministers have resigned after upper house defeats that were less severe.
Abe assumed power in 2006 on a mission to build a nation "prouder of its past", but has come under fire over a number of scandals, including the suicide of his agricultural minister and the mismanagement of Japan's pension system.
Speaking at a news conference on Monday, Abe said: "It was a severe result. We accept the people's judgement seriously and sincerely."
"We must take these results very seriously and reflecting on what we must reflect on... I want to fulfil my responsibility to proceed with reform to build the nation and promote economic growth that the people can feel," he added.
Adding to the slide in public support was Abe's choice of successor to the recently deceased farming minister, who quickly became embroiled in a separate money scandal.
The prime minister said he would ask Norihiko Akagi, the new minister, to explain his financial dealings and to toughen regulations on money politics.
"I want to fulfil my responsibility to proceed with reform to build the nation and promote economic growth that the people can feel"
Shinzo Abe, Japanese prime minister
"Our answers have not been accepted by the people. I have told the party to make sure that we establish strict rules," Abe said.
He added, "As for personnel decisions, I will make sure that appropriate positions go to the right people with the right skills."No alternative
Critics said Abe was out of touch with voters concerned with bread-and-butter issues such as pensions and health care.
Paul Allen, Al Jazeera's correspondent in Tokyo, says that while the election result is a shattering election result for Abe one thing that is likely to save his job is the lack of a clear successor.
Ichiro Ozawa, the leader of the opposition Democratic Party leader who left the LDP 14 years ago, has pledged to shrink income gaps and help farmers, a group that has long been supportive of the LDP.
However Ozawa failed to appear publicly on Sunday and suffers from ill health and many doubt on his ability to keep leading his often fractious party.
The Democrats are a mix of ex-LDP politicians, former socialists and young conservatives, some of whom are seen as ripe for poaching.
Another factor in the prime minister’s favour is that no lower house poll need be held until late 2009, and Abe said he was not considering calling a snap poll anytime soon for that chamber, in which his coalition has a big majority.
Taro Aso, the current foreign minister, has been mooted as a possible successor, but many analysts say he is too similar in outlook to Abe to appeal any better to voters.