Hezbollah, a heavily armed Shi'ite Muslim group backed by Iran, has been pressing its demand for one Sunni Muslim lawmaker allied to it to get a cabinet position, something Hariri has refused.
"The truth is that formation of the government hit a big obstacle," he told a televised news conference in Beirut, six months after a parliamentary election that triggered complex negotiations to form a government.
"The consequences that the country will bear are Hezbollah's responsibility" if a new government cannot be formed, he added.
Lebanon has the world's third largest public debt as a proportion of the economy and stagnant growth. It is in dire need of a government able to make economic reforms.
Rival parties have jostled over how many cabinet positions each faction should get in the new national unity government, and over the most important jobs.
The cabinet is supposed to reflect both the representation of Lebanon's main parties and its major religious sects.
Hezbollah leader Sayyed Hassan Nasrallah insisted on Saturday that one of its Sunni allies be given a portfolio in the new cabinet. He indicated Hezbollah would be ready to go back to square one in negotiating a government if necessary.
Hariri said there could be no solution to the impasse as things stood and reiterated that he would not accept Hezbollah's demand regarding the cabinet portfolio.
"The government is a national, security and social need ... This mission is for me and President (Michel Aoun). I have done everything I can and everyone has to shoulder his responsibilities," Hariri said. (Reporting by Laila Bassam, Lisa Barrington and Ellen Francis, Writing by Lisa Barrington and Angus McDowall Editing by Mark Heinrich)
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