Labor candidate Diedree Steinwall says she will "continue to fight on behalf of residents" despite Labor going backwards in the seat of Hughes at the election on Saturday.
Craig Kelly gained nearly 60 per cent of the vote and gained a swing of 0.6 per cent, two-party preferred, in retaining the seat for the Liberal Party.
With counting not yet completed, the Liberal Party primary vote is up 1.28 per cent, while Labor's is down 0.92 per cent.
Ms Steinwall, a Sutherland Shire councillor who contested Hughes for the second time, said she was "disappointed" for federal Labor.
"However, I am encouraged by the support I received in the community and the enthusiasm and dedication of all the volunteers on this campaign," she said.
"We worked tirelessly to highlight Labor's positive policies for the environment, its comprehensive education and health policies and cost of living issues.
"Ultimately, we live in a democracy and the people have spoken.
"I will continue to fight on behalf of residents and take up the issues that concern all in our community.".
Mr Kelly told supporters at Woronora Valley RS Club on Saturday night, "We weren't taking on the Labor Party - we were taking on Labor, Greens and GetUp".
"We had three teams against us and we smashed them all."