Somali President Abdullahi Yusuf Ahmed has said Islamist insurgents now control most of the country, and have advanced to the edge of Mogadishu.
Mr Yusuf said there was no effective government in Somalia, and that insurgents were now able to carry out attacks in the capital at will.
The president was speaking to Somali parliamentarians in Kenya, a day after talks on forming a new cabinet failed.
Last month, regional grouping Igad set a deadline of 12 November for a deal.
The mandate of the Transitional Government of Somalia (TFG), formed in late 2004, is set to expire in August 2009.
Call for unity
President Yusuf was at his gloomiest on Saturday, addressing Somali MPs in neighbouring Kenya.
He said the Islamist insurgency, which looked as though it had been crushed two years ago following intervention by the Ethiopian army, was now as strong as ever.
Members of the al-Shabab group now controlled most of the country and had advanced to the suburbs of Mogadishu, as well as Baidoa, the home town of the parliament, he said.
"The government controls Mogadishu and Baidoa and people are killed there every day," Mr Yusuf told the meeting in Nairobi.
"Islamists have taken over everywhere else, so if I ask you parliamentarians: do you know the situation we face? Who causes all these problems? We are to blame."
President Yusuf lamented that at this vital time when unity is needed, talks on forming a new transitional government had ended in failure.
He and Prime Minister Nur Hassan Hussein have been unable to agree on the make-up of a new cabinet, missing a deadline issued by the Inter-Governmental Authority on Development (Igad) last month.
In the meantime members of al-Shabab, which the US believes to be linked to al-Qaeda, have consolidated their hold on southern Somalia, meting out punishments on the population based on their interpretation of Islamic law.
They whipped 25 women and seven men for holding a traditional dance, which they said was forbidden.
In October, a girl was stoned to death in a crowded stadium in the port city of Kismayo. Aged just 13, she had been convicted of adultery after complaining she had been raped.