Danny Alexander has become the latest senior Liberal Democrat collapsing to defeat, losing to the SNP’s Drew Hendry by more than 10,000 votes.
With Mr Alexander’s widely-expected demise, Nick Clegg has lost every cabinet colleague from his wing of the coalition.
Mr Alexander said: “I will always be proud of the difference I and my party have made to the country in the last five years.”
Mr Hendry won 28,838 votes to Mr Alexander’s 18,029.
Speaking to reporters after losing the seat, Mr Alexander criticised the “hugely divisive” campaign run by David Cameron and warned that the SNP would use their success to push for a second referendum on Scottish independence.
He said: “It’s been incredibly disappointing for the Liberal Democrats. I remain very proud of what we’ve done over the last five years in terms of the country and in terms of what I’ve delivered personally here in the Highlands but clearly some voters have other things on their minds and I think we have to spend time to try and understand what that’s about.
“In this constituency I got more or less a very similar number of votes to that which I received in 2010, but the SNP did very well and they’ve had a wave of success across Scotland, the Labour Party has almost disappeared and those votes have gone to the SNP.
“I suspect they will try and use this to push for another referendum on independence which I think would be the wrong thing for our country.
“I think that those who have been elected to parliament and political parties have got a lot of thinking to do about the future.”
Mr Alexander said he wanted to ensure that the “flame of liberalism keeps burning” in the Highlands and across the UK.
He said: “I think we have got a great record and a great history here in the Highlands and I want to make sure that that continues.”
Attacking David Cameron and the campaign run by the Conservatives, he said: “I think that the way David Cameron has conducted this election campaign has been hugely divisive for the UK.
“He has tried to stoke up the fear of the SNP in England and has helped the SNP to stoke up the fear here in Scotland and it’s been a campaign where the two parties have fed off one another and I think that has been very divisive within the UK.
“I hope that Mr Cameron, if he does continue as prime minister, will reflect much more carefully on what’s needed to heal the United Kingdom rather than simply pandering to his own party advantage.”
Asked about speculation he may enter the House of Lords, Mr Alexander said: “I’m going to go and have a good night’s sleep, I don’t have any plans beyond that.
“I’ve lost an election which I’m deeply disappointed by, but there are many many worse things that could happen to people and I’m sure that I’ll find something useful to occupy my time in the weeks to come.”