Cath Grundy has failed in her attempt to become deputy leader of Birmingham City Council's opposition Labour group.
Ian Ward, who has held the position since 2005, was re-elected at the annual group meeting on Saturday by 24 votes to 10.
Kingstanding councillor Grundy, who said Labour was failing to get its message across and had campaigned for a more cohesive and inclusive approach, said she was disappointed but felt that her decision to stand had been worthwhile.
She went into the meeting expecting to get support from 23 Labour councillors, but her backers failed to materialise on the day.
"That's what I had been promised and there were a lot of nods when I made my speech. Unfortunately, not all of the nods translated into votes," Coun Grundy said.
She said Labour had a year to show it could unite and become a more forceful opposition to the council's controlling Conservative-Liberal Democrat coalition. Her challenge had enabled underlying concerns to be openly debated for the first time.
Coun Grundy added: "A lot of people expressed a lot of concerns at our AGM. I was pleased they were able to do that."
The result will be seen as a vote of confidence for Coun Ward and group leader Sir Albert Bore at the end of a difficult couple of weeks for Labour.
The party lost six seats to the Conservatives at the council elections on May 1, reducing Labour to its weakest position in Birmingham for more than 20 years.
Coun Ward (Lab Shard End) said: "My re-election is an endorsement for the group leadership. The result will hopefully be the last of any challenges."
He found Coun Grundy's remark about lack of inclusivity a "strange comment".
Coun Ward added: "I have always been very inclusive and I don't have any problem including all members of the group. But it is very difficult when you are in opposition because you don't have the votes and you aren't winning very much. It is easy for others to criticise but I think the position is more difficult than when you are in office."