The government says voters' approval of a ban on new minarets reflects fears among the Swiss population of Islamic fundamentalism.
However, it considers a ban is not the right way to prevent extremist tendencies. In an apparent effort to downplay the impact of the result, cabinet ministers maintained religious freedom for Muslims was not at risk and said inter-religious dialogue would continue.
The mood at Sunday's news conference in the capital Bern was decidedly subdued when three cabinet members appeared before the media to comment on the outcome of the vote and take questions.
"The government is disappointed that it was not possible to convince voters to reject the initiative," said Economics Minister Doris Leuthard.
In a major upset the proposal by members of rightwing parties won 57.5 per cent of the vote, despite recommendations by the government and a majority in parliament that the initiative be thrown out.
"Emotions were running high during the debate. This ruled out any possibility to show that a ban on minarets is a 'proxy war'," said Justice Minister Eveline Widmer-Schlumpf.
"The outcome of the vote is undeniably a reflection of the fears and uncertainties that exist among the population; concerns that Islamic fundamentalist ideas could lead to the establishment of parallel societies," she added.
The fear of Swiss traditions, values and laws being rejected had to be taken seriously, she said, but a ban on minarets did not help to solve any of the problems.
"The vote must not lead to mutual distrust. Marginalisation and exclusion on the basis of religious and cultural differences would be devastating for an open country such as Switzerland."
She stressed that Muslims in Switzerland are free to practise their beliefs and that the minaret ban is not a rejection of their community, religion or culture.
"The fundamental freedom of religion and conscience applies to all religions, " she said.
In a separate news conference in Geneva, Foreign Micheline Calmy-Rey argued that the result of the vote was a reaction to fears of globalization and the current economic crisis.
"In this context it was easy for the campaigners to exploit people's fears," she told swissinfo.ch.
Calmy-Rey said she was shocked and disappointed about the outcome of the vote, also because the initiative had the backing of one of the main political parties in government.
For her part, Widmer-Schlumpf said the government would respect what was a democratic decision, but it would also step up efforts abroad to explain the outcome of the vote.
"We will try to make clear that it is not a rejection of dialogue between different religions," she said.
Business relations are likely to become more difficult, particularly for the export industry and tourism – two key sectors of the economy, according to Widmer-Schlumpf.
Swiss history showed that the way to religious peace and understanding between Christian and Jewish communities as well as between Catholics and Protestants has been long and arduous, according to Communications Minister Moritz Leuenberger.
The government and numerous experts have argued that a ban on constructing minarets is in violation of the freedom of religion and legal safeguards contained in the European Convention on Human Rights.
"These guarantees are binding on Switzerland under international law," Widmer-Schlumpf said.
She expects appeals to be lodged at the European Court of Human Rights in Strasbourg.
"We will have to deal with the consequences of a possible decision by the court to approve the appeal," she said.
The Green Party announced it was considering an appeal against the minaret ban.
There are presently about 200 mosques and prayer rooms in Switzerland, but only four have a minaret. Requests are pending for the construction of four other minarets.
Muslims account for about 4.5 per cent of the Swiss population. Most of them have come from the former Yugoslavia and Turkey since the 1990s.
Urs Geiser, swissinfo.ch with input by Mohammed Cherif
Minaret ban - final results:
Four cantons carried out trials with e-voting. The Swiss abroad registered in Geneva and Basel City were also taking part in the scheme.
Switzerland has become the first European country to ban the construction of minarets.
The proposal was launched by members of the rightwing Swiss People's Party and the ultra conservative Federal Democratic Union.
The initiative came in response to opposition by conservative groups at a local level against applications to build a minaret next to a mosque.