In a major upset, Sen. Lisa Murkowski has conceded her GOP Senate primary race to Tea Party Express favorite Joe Miller, who had the backing of former Alaska Gov. Sarah Palin.

"I don't see a scenario in which the primary will turn out in my favor," Murkowski said in her concession speech.

Murkowski made the concession speech Tuesday night, a full week after the primary.

Miller has never held elected office but he is now the immediate front-runner in the heavily Republican state.

Murkowski trailed Miller, a Fairbanks attorney, by 1,668 votes after last week's primary. Election officials began counting absentee and outstanding ballots Tuesday. Murkowski made slight gains, but was never able to get Miller's lead below 1,200 votes.

The contest had turned bitter in recent days with Miller accusing Murkowski of trying to steal the election by tampering with the vote. Murkowski shot back by saying Miller is paranoid and dealing in trumped-up, misleading rhetoric.

Murkowski had hoped to avoid the fate that has befallen other incumbents nationwide as they were swept out of office in 2010 amid an anti-incumbent fervor.
She said she was proud of the campaign she ran, which she called "honest" and "upright." She said the campaign stayed focused on the issues and the "high road."

 "I'm coming back home," she said. "You all know my heart and soul has always been in Alaska."

The Associated Press contributed to this report.