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What if the PM didnt get elected in his riding?

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So what happens if say the liberals remained in power but Paul Martin did not win in his riding? Does he still remain as the PM and leader of his party?
 
Yes.  By tradition another member who did get elected will be asked to step aside for the party leader.  Most will do so.  However, in a past election, I believe Chretien tried that and the encumbent told him to get lost.  Which did great things for the politician's career, and ability to promote his issues in caucus.

But that's what happens.
 
More on this.   While he isn't the PM, Jack Layton had never held a Parliamentary seat--until yesterday, yet he he was the party leader for NDP.   Just pointing this out and using Layton as an example because there is no rule that says the leader of a political party needs to hold a riding.
 
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