Speaking during her visit to Udon Thani province in the Northeast, the day after the Democrats announced their election boycott, the prime minister said the Democrat Party wanted political reform, but did not want to take part in the election.
The Democrats' decision has caused her to worry how the country will move forward without an election, which is required under the constitution, she said.
"If [they] do not accept this government, I would urge them to respect the [democratic] system. We've returned the power to the voters to decide on the future of the country," she said.
"If [the Democrats] refuse to play by the rules and move forward, the government doesn't know what to do next," she said.
"As the power is now vested with voters, unrest is likely to erupt if the rule of law is not maintained."
Under the current circumstances, the entire country would suffer the consequences of such unrest, Ms Yingluck said.
The government has insisted on continuing its caretaker role, not because it is clinging to power, but because it is the government's responsibility to ensure the Feb 2 election takes place, she said.
It was also a source of regret that while many other nations, including fellow Asean members, were embracing democracy, Thailand was not, Ms Yingluck said.
The government had responded to calls for House dissolution, but now that the anti-government protesters did not want to follow the charter, the government is unsure where to go next for guidance, she said.
As for the government's proposal to introduce national reform after the Feb 2 election, several sides of the conflict had expressed interest in the idea, she said.
However, she wants anti-government protesters to agree with the proposal because the government reform forum must reflect the needs of all sides, not just of one particular group, she said.
Ms Yingluck is on the last leg of her trip around the northeastern provinces. She travelled by train from Udon Thani to Nong Khai yesterday.
She was monitoring the coverage of yesterday's anti-government demonstrations on her iPad throughout the trip.
Ong-art Klampaibul, the new deputy leader of the Democrat Party, said the Democrats would focus on plans to organise a nationwide public forum.
The forum would be used to compile public opinions to draft a "blueprint of the country", so people from all walks of life could agree on how to move out of the political impasse, Democrat spokesman Chavanond Intarakomalyasut said.
Democrat Party chief adviser Chuan Leekpai said it was ironic that Ms Yingluck was calling for others to abide by the law while the government itself refused to follow the Constitution Court's ruling.
He was referring to the court's ruling against the government's draft amendment on the constitution regarding the composition of the Senate.