According to exit polls:
The exit polls showed that 42 percent of voters called corruption an extremely important issue in their choices at the polls, followed by terrorism at 40 percent, the economy at 39 percent and the war in Iraq at 37 percent.
The Wash Times story on why the GOP lost is heavy on the war as biggest factor:
"There was general revulsion in the country, particularly among Democrats and independents, against the conduct of the war in Iraq," said pollster John Zogby. "This was, at the grass roots, a referendum against the war and the president. For Republicans, there was significant disappointment about opportunities lost through enormous budget deficits, threats to civil liberties, a failed social agenda, and the war."…
Longtime conservative activist Paul M. Weyrich agreed. "The war in Iraq had to be what went most wrong for Republicans," said Mr. Weyrich, president of the Free Congress Foundation. "The public didn't like it and blamed the Republican Party for it. A good portion of the disaffected vote was, I think, made up of conservatives. When you add dissatisfaction over the issues of immigration and spending, it was just too much."