Labour held on to its seat in Peterborough by a margin of only 683 voters - in a constituency of 70,000 voters - in the early hours of Friday, 7 June.
The Brexit Party came second, pushing the Conservatives into third place, and the party’s leader, Nigel Farage said they had been narrowly defeated because of the well-oiled machine which Labour had deployed on the ground.
Mr Farage said: “Something very significant is happening. We had energy and enthusiasm but because we are so new we had no data.”
The Brexit Party topped the poll in last month’s European elections, getting 29 MEPs elected and sending ripples of fear through both Labour and the Conservatives.
Mr Farage’s party had been widely tipped to get its first MP elected in Peterborough but their candidate Mike Greene was beaten by Lisa Forbes, a local councillor who had been at the centre of a row about anti-semitism last week.
The Jewish Chronicle reported Ms Forbes had apologised for liking a Facebook post that claimed Theresa May had a “Zionist slave masters’ agenda.”
An investigation of Ms Forbes's social media activity also found she wrote under a Facebook claiming Daesh was created by the CIA and Mossad: “ I have enjoyed reading this thread so much.”
Two Labour MPs expressed reservations about Ms Forbes’ victory.
Margaret Hodge, who is Jewish, tweeted that she had “formally raised concerns with the party” and Jess Phillips, a long-time critic of Labour leader Jeremy Corbyn, tweeted: “The reality is I cannot be gleeful or proud as I’d want to be because of how it shows that anti-semitism is becoming normal in the party.”
The by-election was called after the previous Labour MP, Fiona Onasanya, was jailed for lying in a bid to avoid a speeding ticket.
Although the Brexit Party did not win the seat it might be too early to write them off as a political force.
Political commentator Andrew Neil pointed out that at the 2017 general election the combined Labour/Tory vote share was 95 percent, but in Thursday’s by-electiion it was only 52 percent.
If a general election were to be called today the Brexit Party would undoubtedly pick up seats from both Labour and the Tories.
Theresa May is stepping down as leader of the Conservative Party on Friday, 7 June, and her successor will need to rapidly reinvigorate the Tories and come up with a solution on exiting the European Union if they are to reverse the growth of the Brexit Party.
If, as predicted, Boris Johnson were to win the former foreign secretary is likely to back a no deal Brexit, which would steal the Brexit Party’s clothes and firm up support in Leave areas of the country but could lose many Tory seats in Remain constituencies in London and the south east of England to the Liberal Democrats.