As I predicted this is was the closest election since February 1974 and like then it produced what the media like to call a 'hung parliament.' (Personally I prefer the less emotive local government term 'No Overall Control').
The arithmetic (Con 306, Lab 258, Lib Dem 57, others 28) meant there were only two truly viable options, a Conservative minority government (as with Labour in 1974 and with the SNP in Scotland today), or a Conservative Liberal Democrat coalition with an agreed programme, and the potential to run a full term.
Any arrangement with historic political enemies can be difficult to swallow, but coalition between parties is a fact of life in nearly all other countries in Europe. Political parties themselves are also coalitions, and we have been governed by a coalition between 'Blair-Labour' and the 'Brown-Labour' for the last 13 years!
In any coalition its not what is said but what is done that will matter in time. The agreement between the parties has been widely publicised, but don't believe what the newspapers tell you, read the full version for yourself here: http://www.general-election-2010.co.uk/conservative-and-liberal-democrat-coalition-goverment-agreement.html