Lord Mandelson has advised Labour Party members unhappy at the election of Jeremy Corbyn not to be in a hurry to see him replaced as leader.
In comments first seen by the Guardian newspaper, the peer argued Mr Corbyn had to demonstrate his "unelectability" at the polls before facing a challenge.
He also blamed the current state of the party on the legacy of New Labour and former leader Ed Miliband.
Mr Corbyn's team and the Labour Party have not commented on the remarks.
"The original New Labour generation owe the younger generation an apology: what we passed on when we left government in 2010 was not fit for purpose," Lord Mandelson said.
Under Ed Miliband, he went on, Labour "had still not acquired any coherent forward agenda but nor did we have a leadership the public recognised as 'big' figures.
"They appeared to the public more like special advisers than real politicians."
Lord Mandelson told opponents of Mr Corbyn to prepare for the "long haul".
He said: "In choosing Corbyn instead of Ed Miliband, the general public now feel we are just putting two fingers up to them, exchanging one loser for an even worse one.
'Public will decide'
"We cannot be elected with Corbyn as leader. Nobody will replace him, though, until he demonstrates to the party his unelectability at the polls.
"In this sense, the public will decide Labour's future and it would be wrong to try and force this issue from within before the public have moved to a clear verdict."
BBC political correspondent Iain Watson said the comments could be seen as a message to long-standing members of the party to wait until next spring - after elections to the Scottish Parliament and for London mayor - before making any move on Mr Corbyn's position.
If the advice is followed, it may give Mr Corbyn breathing space free from open warfare in the party, our correspondent adds.
The left-wing Islington North MP, who is 66, was elected as Labour leader with nearly 60% of the party vote earlier this month,
Ahead of the election, Lord Mandelson was joined by New Labour colleagues Tony Blair and Gordon Brown in warning of the dangers of a Corbyn leadership.