The Premier League champions sit just two points above the drop zone after suffering their sixth defeat in 12 matches, a 2-1 loss at Watford.
Ranieri knows Leicester must start winning games as they look to move clear of the bottom three.
"Worried? No. But last season I was always watching behind me. Also this season I'm watching behind me.
"The relegation is very close to us and we have to react.
"I expected difficulties [this season], but not so strong. I expected some more points.
"That's normal after a team like Leicester win the title. Now we have to be compact, continue to work hard, because there is only one medicine - work hard and be together."
Leicester captain Wes Morgan, meanwhile, said his team-mates must keep believing ahead of Saturday's visit of Middlesbrough.
"Things aren't going as we would have liked in the league," he said. "I felt [the match at Watford] was definitely the game but it wouldn't drop for us.
"We had a bad start – two goals down in  minutes, which made it very difficult, but the spirit was there and we did try, and that is the only positive we can take from the game.
"It is hard to say [what the difference is], we had such a high level of play last season when we were winning games and were full of confidence."
Morgan added: "Things aren't coming together. It is disappointing but we need to keep going, keep believing in ourselves.
"It is hard to take any positives from the game but we did put a lot of effort into it and I think the fans saw that.
"I just feel maybe one or two wins will put us back on track. Momentum is a big thing.
"Once we find our consistency again, hopefully that will change our luck and we can start climbing up that table."