The number of people who speak Welsh has fallen in the past 10 years, according to the 2011 census.
Figures also suggest Welsh is now a minority language in two heartlands, Carmarthenshire and Ceredigion.
It has been thought that migration trends and education might lead to an increase in speakers in less traditional Welsh-speaking areas.
But the census suggests otherwise, with just two areas, Monmouthshire and Cardiff, seeing a percentage increase.
Only in Gwynedd and Anglesey do over half the population now speak Welsh.
The Welsh government said it took some comfort from the fact there were considerable increases in younger children who spoke Welsh.
This is seen as a sign that efforts to promote the language amongst young families were paying off.
The number of Welsh speakers overall has fallen from 582,000 in 2001 to 562,000 last year, despite an increase in the size of the population. This represents a two percentage point drop - from 21% to 19% - in the proportion of Welsh speakers.
The percentage of the population with no Welsh language skills also increased from 2001 to 2011, according to the Office for National Statistics (ONS) data.
Speaking before the results were released, First Minister Carwyn Jones said he expected figures to show a smaller proportion of Welsh speakers in the traditional stronghold communities of the language, but with more people speaking Welsh in other parts of Wales.
However, the data suggests Cardiff and Monmouthshire are the only local authority areas to have registered a percentage increase in the proportion of Welsh speakers.
But in Cardiff there was only a slight rise, from 11% to 11.1%, and Monmouthshire reported a slightly larger increase in at 9.9%, up from 9.3%.
There are differences within age groups, with increases in the number of Welsh speakers among younger children aged three to four, a slight increase for adults 20 to 44, and decreases for other age groups.
Gwynedd had the highest percentage of residents aged three and over who said they could speak, read and write in Welsh, at 56%.
It has also been suggested that parents have previously over-estimated the ability of their children to speak to Welsh.
This is because the numbers of younger adults who said they spoke the language had fallen in comparison with figures from 2001, even though many of them may have attended Welsh-speaking schools.
Pete Stokes, from ONS, said: "It could be over-estimating by parents. It could also be outward migration from Wales as people who are well-qualified are more likely to leave Wales.
"It could be that people when they leave education don't use Welsh in their day-to-day lives."
Welsh Language Commissioner Meri Huws said the findings came as a shock.
"Perhaps there has been a danger for everyone to be lulled into a false sense of security 10 years ago, believing everything would be alright, and that the growth in some areas would make up for the decrease in other areas," she said.
"If that was the case for the past 10 years, the alarm clock has rung very loudly this morning, and there are very definite challenges to be faced here, and urgently."
Earlier, First Minister Carwyn Jones said the next challenge for the Welsh language was to ensure young people spoke it outside the classroom.
Mr Jones said his own children speak English to each other, despite going to a Welsh-language school.
"Cracking that is going to be crucial to the future of the language over the next 10 years," he said.
Other politicians said action was needed to stem the decline in the language.
Plaid Cymru leader Leanne Wood AM said: "Today's figures are disappointing and I'm sure citizens across Wales will be concerned about the decline in the number of Welsh speakers across the country.
"These are very clear warning signs for the future of the language and there must be a decisive response."
Tory language spokesperson Suzy Davies said: "There is a generation of young people who have studied Welsh to the age of 16 at school, yet they still don't see themselves as Welsh speakers.
"How much of that is down to a slow shift in how we see ourselves? How much is down to low priority that the language has in some English-medium schools, despite being a compulsory part of the curriculum?"
Robin Farrar, chair of Cymdeithas yr Iaith Gymraeg (Welsh Language Society) said the language faced a crisis.
"This news reflects very badly on the Welsh government who set a target of increasing the number of Welsh speakers by 5% over the decade. Over the last 10 years, they have failed to support the Welsh language in the way they should.
"The fall in all the counties in the west is a matter of great concern. The people of Wales are very supportive of our unique language, but the government isn't matching their ambition."
Welsh education minister Leighton Andrews said: "The Welsh language and Welsh language communities face challenges and the issue now is not to blame people but decide how to work together to ensure a sustainable future for the language."
He said he would be open to new ideas and had a strategy, launched in March, which included encouraging the use of Welsh in social media.
A Welsh government spokesman added that the strategy recognised the "fragile state of the language" and looked to promote its use across all walks of life.
Other data from the census showed:
- Nearly two-thirds (66% or two million) of residents gave their national identity as Welsh;
- Wales has the highest percentage of people stating they have no religion (32%) - the first time this question has been asked. The proportion of people in Wales who said they were Christians has decreased 14% since 2001 to 1.76 million (58%);
- Wales had a higher proportion of residents reporting that their day-to-day activities were limited a little or a lot by a long-term health problem or disability (23%) than any English region.
- The number of cars and vans available to households in Wales increased 20% between 2001 and 2011, from 1.3 to 1.6m.
- The number of married couple households fell more in Wales (by five percentage points) than in England, particularly in Blaenau Gwent and Newport (down by seven percentage points)