Sinn Féin's Michelle O'Neill has accused the secretary of state of making a "bizarre u-turn" over calling an election.
She was reacting after Chris Heaton-Harris said he'll call a snap Assembly election, but did not set a date.
Mr Heaton-Harris has denied he is back-tracking on what he said previously, that if the deadline to reform the Executive was not met last night, he would go ahead with a poll.
At a press conference on Friday, the Northern Ireland secretary said he will give a further update on the matter next week, after meeting with the parties.
Ms O'Neill said: "I think just think it is bizarre, it reflects the chaotic nature of the Tories, it is more dysfunction, it is spilling into our politics.
"But you see for the workers and families tonight and the businesses that are struggling, the people here that are left without an Assembly, an Executive.
"There is not even a caretaker minister in place and we have a situation tonight where people just don't know what is going to happen next."
DUP Leader Sir Jeffrey Donaldson called on the Government to "focus on resolving the problem rather than dithering over an election".
He said: "The Government and the NIO talked up an election and now no one knows what is happening.
"It is now clear the secretary of state’s boss, the Prime Minister, has not yet decided how to proceed.
"Our message to the Government continues to be that they need to get the Protocol replaced and then we will have the basis for establishing a devolved government that Unionists and Nationalists can support.
"The Government has undermined its own credibility in recent weeks, instead of focusing on the underlying problem."
Paula Bradshaw of the Alliance Party said: "We were waiting from one minute past midnight on the secretary of state telling us whether we were going to the polls or into protracted talks.
"We've been left now in a state of limbo and confusion."
SDLP Leader Colum Eastwood has urged the Northern Ireland secretary to drop the idea of an Assembly election and "focus on restoring the Stormont institutions".
Mr Eastwood said: “The secretary of state’s failure to outline details of an Assembly election today should be the end of the idea.
"The only thing proposing an early election achieved was prompting anger from the public who want politicians dealing with issues like the cost of living emergency and our crumbling health service, not knocking on their doors."
TUV Leader Jim Allister called on the secretary of state to focus on the protocol rather than "mind games" of threatening an election.
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