Charles Kennedy was fighting for his political life last night after admitting he was being treated for alcoholism and calling a leadership election. The Liberal Democrat leader was forced into his gamble to head off media revelations about an alcohol problem that has been rumoured at Westminster but which he has consistently denied.

He suffered another blow to his authority when it emerged that 11 of his 23-strong shadow cabinet had signed a private letter saying he had lost their support and his position had become untenable. That could prove more damaging than his disclosure that he had been fighting alcoholism for the past 18 months.

Mr Kennedy's decision to urge his critics to "put up or shut up" threw the spotlight on potential challengers. Some MPs said Mr Kennedy would be "dead meat" if a challenger emerged, which would trigger a postal ballot among the party's 75,000 members.

Mark Oaten, the home affairs spokesman, and Sir Menzies Campbell, the party's deputy leader, said they would not run. But Simon Hughes, the president, refused to rule himself out. Some insiders said Mr Kennedy might yet be persuaded by the party's so-called "men in sandals" to stand down voluntarily after losing the backing of senior figures who might now find it difficult to serve under him.

Allies praised Mr Kennedy's honesty but he still had to fend off allegations that he had persistently lied to the media. Even yesterday, his aides were dismissing the claims but made a U-turn when they learnt that ITV News was going to reveal how he said to senior colleagues in 2004: "I am an alcoholic."

Senior party sources told ITV that Mr Kennedy's "continued relapses" were damaging the party. His refusal to acknowledge the impact his condition was having on his performance was also a cause for concern.

One source said: "It is unimaginable that he would stand in the leadership election." Another said Mr Kennedy's private office was "lurching from one crisis to another, pulling him out of the abyss". A third said: "One man's drink problem is destroying a party with a 200-year history."

Mr Kennedy hoped his announcement would stave off demands for a vote of confidence among his MPs. But he suffered a setback late last night when Nick Harvey, MP for Devon North, said such a vote should still go ahead because the leader's position was "unsustainable" after losing the support of the vast majority of his colleagues. "What we need is a real leadership contest with real candidates, not an absurd, Soviet-style one with only one," he said.

The letter was organised by Vince Cable, the party's Treasury spokesman. The others who signed it were David Laws, Ed Davey, Norman Baker, Chris Huhne, Sandra Gidley, Andrew George, Norman Lamb, Michael Moore, Sarah Teather and John Thurso. They suggested they would quit their posts unless he did. Although the letter was never sent, Mr Kennedy was aware of it.

Mr Lamb said the party needed "mature reflection" on Mr Kennedy's announcement. "I advocated an earlier statement of this sort. But it has taken too long," he said.

Making his extraordinary "personal statement", Mr Kennedy said he wanted to continue as leader but that it was only "fair" to give his party a chance to replace him. "People close to me know that this has been a struggle and that for extended periods I've consumed no alcohol at all. As a matter of fact I've not had a drink for the past two months and I don't intend to in the future," he said.

Mr Kennedy, who had been fending off demands for a leadership contest, began a rethink yesterday after Mr Baker, the environment spokesman, called for the crisis to be resolved. "We need to bring this to a head because it won't simply go away," Mr Baker said. Mr Kennedy then met close allies and decided to "lance the boil".

Mr Hughes said he would not make up his mind about whether to stand until, as party president, he had set the procedures in train for a contest. " It would be quite wrong for me to even make a decision before we have made that decision," he said.

'A drink problem is a serious problem indeed'

This is the text of Charles Kennedy's statement yesterday

"I've called this press conference to address one issue directly and one that's been a source of concern for me and others for some time.

"Over the past 18 months I've been coming to terms with and seeking to cope with a drinking problem, and I've come to learn through that process that a drink problem is a serious problem indeed. It's serious for yourself and serious for those around you.

"I've sought professional help and I believe today that this issue is essentially resolved. People close to me know that this has been a struggle and that for extended periods I've consumed no alcohol at all. As a matter of fact I've not had a drink for the past two months and I don't intend to in the future.

"I learnt the hard way of the need to face up to this medical problem, one that is dealt with successfully by many others on a daily basis.

"I chose not to acknowledge it publicly before because, if possible, I wanted to overcome it privately. So in a sense this admission today comes as something of a personal relief.

"I should have been willing to talk about it more openly beforehand and I wish I had.

"This issue has understandably been of concern to parliamentary colleagues and they have been both understanding and supportive, and I am extremely grateful to them for that.

"It has also been behind much of the speculation about the leadership within the party. So let me be clear: I consider myself to be capable and in good health and remain determined as the leader of this party.

"This party's members have shown me tremendous support over the years and overwhelmingly so in recent weeks and days. It's a privilege to serve as their leader.

"I want to continue to do so, not least because I believe that the prospects in front of us in this Parliament are very great indeed.

"Given this statement, I believe it's only fair now to give our party members their say over my leadership. It's open of course to any colleague who believes they can better represent the interests of the party to stand against me.

"Given the personal nature of this statement, I hope you understand that I do not propose to take any questions. Thank you for your attention.

The signatories

The frontbenchers who signed a letter calling on Mr Kennedy to stand down

Vince Cable

Norman Baker

Ed Davey

Sandra Gidley

Andrew George

Chris Huhne

David Laws

Norman Lamb

Michael Moore

Sarah Teather

Leaders in waiting?

David Laws, 40

WORK & PENSIONS SPOKESMAN. ODDS OF BEING NEXT LEADER: 20/1

One of the standard bearers of the party's modernising wing hoping to shift the Lib Dems to the right. Bright and articulate work and pensions spokesman and former senior member of the party's Treasury team. He was a key figure behind the controversial Orange Book, advocating a system of social insurance to replace the NHS. Said to be one of the frontbenchers who signed a letter calling on Mr Kennedy to stand down.

Simon Hughes, 54

PARTY PRESIDENT. ODDS: 5/1

Highly ambitious party president and former candidate for Mayor of London who gave up his high profile position as home affairs spokesman to campaign for the London mayoral elections. The taxi-driving Southwark MP is loved by the party rank and file as a charismatic and tireless campaigner from the traditional left wing of the party. He is also famed in Liberal Democrat circles for his work building support in London. Highly likely to contest the leadership but would face strong opposition from many in the parliamentary party.

Nick Clegg, 38

FOREIGN AFFAIRS SPOKESMAN. ODDS: 10/1

Former Liberal Democrat MEP who only entered Parliament in May, rapidly being promoted to the front bench as a foreign affairs spokesman. Many Lib Dems see him as a leader in waiting, possibly taking up the standard by playing a Cameron to Sir Menzies Campbell's Howard. Amiable and able moderniser, but very new to the ways of Westminster and so highly unlikely to mount a serious bid for the top jobso soon after becoming an MP.

Ed Davey, 41

EDUCATION SPOKESMAN. ODDS: 8/1

Energetic MP for Surbiton and Kingston. Another leading member of the Orange Book group of modernising MPs, Mr Davey is said to be one of the frontbenchers who signed a letter calling on Charles Kennedy to stand down before Christmas. The former management consultant and economics adviser pulled off a coup when he turned his majority of 56 in the 1997 general election into a majority of more than 15,000 at the 2001 election. Mr Davey, who holds an award for bravery, is known as a charming, ambitious operator and policy expert who was given a crucial public service brief.