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LONDON -- Ladies and gentlemen, start your political campaigns -- if you dare.

That was the message British Prime Minister John Major delivered yesterday when he quit as Conservative Party leader and challenged his right-wing critics to "put up or shut up" in a leadership fight.

Mr. Major, whose party is at an all-time low in opinion polls, will continue as prime minister, at least pending results of the July 4 leadership election.

Yesterday's terse announcement in the garden of his Downing Street home stunned his opponents and electrified his supporters. Under party rules, Mr. Major could have waited for a Conservative to challenge him in November. Instead, he took the initiative in the biggest gamble of his political career.

"The Conservative Party must make its choice," said the 52-year-old prime minister. "Every leader is leader only with the support of his party. That is true of me as well.

"That is why I am no longer prepared to tolerate the present situation. In short, it is time to put up or shut up."

For months, Mr. Major has been dogged by critics who see a loss of British sovereignty in some of the issues of closer integration with the 15-nation European Union. He was also stung in the past two weeks when former Prime Minister Margaret Thatcher said he wasn't conservative enough.

"I believe this is in no one's interest that this continues right through until November," Mr. Major said. "It undermines the government and it damages the Conservative Party. I am not prepared to see the party I care for laid out on the rack like this any longer."

Senior members of Mr. Major's Cabinet pledged their support to the prime minister, and no candidates emerged for his job. Nominations close Thursday.

Lady Thatcher has been at bitter odds with her hand-picked successor over European unity issues, but even she gave him grudging support yesterday.

"I believe he can be re-elected," she said in a French television interview. "I think it is a good thing that he did this. It shows that he cares."

Asked whether she would consider a run, Lady Thatcher said, "No. You can't go back. Never try to go back."

In Washington, President Clinton appeared surprised when a press spokesman informed him of the news as he left for a dedication ceremony at Arlington National Cemetery.

In a statement, Mr. Clinton said Mr. Major "has maintained a strong relationship between the U.K. and the U.S., and he has shown real courage in pursuing peace in Northern Ireland. I wish him well."

Under Britain's political traditions, a stalking horse from the Conservative back bench could mount a first-ballot challenge to smoke out the prime contenders.

Norman Lamont, a former chancellor of the exchequer, has been rumored for weeks to be considering a challenge to Mr. Major. Last night, a press horde surrounded Mr. Lamont at his home. After a cameraman knocked over a gate, Mr. Lamont snapped, "This is my gate." But he declined to answer questions.

If Mr. Major is unchallenged or captures the necessary first-ballot majority of Conservative members of Parliament, he will regain the leadership and take the party into the next general election, which must be held by mid-1997.

If he fails to clear the first-ballot hurdle with an overall majority -- and fails to get 15 percent more votes than his nearest rival -- he could feel compelled to resign. That would ignite a frantic second-ballot election July 11, with the principal contenders entering the race.

Lady Thatcher was ousted in nearly identical circumstances in 1990, leading to Mr. Major's selection.

For now, though, the main Tory players are sticking with Mr. Major. Michael Heseltine, president of the Board of Trade and a popular politician among Conservatives who favor greater economic and political ties to Europe, threw his support behind the prime minister. So did Michael Portillo, the employment secretary and darling of the Conservative Party's anti-European right-wing.

Opposition leaders ridiculed the maneuver.

"It is the Conservative Party that is disintegrating, and the people of Britain deserve better," Labor Party leader Tony Blair said. "This leadership election cannot give Britain the change of direction it needs. Only a general election can do that."

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