Germany's Social Democrats narrowly won a milestone election on Sunday, a victory that marks an end to 16 years of conservative rule under Angela Merkel.
Projected results showed the center-left Social Democrats (SPD) were on track for 26 percent of the vote, ahead of nearly 25 percent for the conservative bloc - though both groups believe they could lead the next government.
SPD’s candidate for Chancellor, Olaf Scholz, thanked his supporters.
"And of course I am very happy about the election result that the citizens of this country have chosen. They have decided that the SPD should rise upwards, and that is a big success."
Scholz would become the fourth socialist democrat chancellor since World War II.
His conservative rival, Armin Laschet, signaled his bloc was not ready to concede, though his supporters were more subdued.
"We will do everything possible to build a conservative-led government because Germany (INTERRUPTED BY APPLAUSE), Germany now needs a future coalition that modernises our country."
The most likely outcome is a three-way alliance involving the smaller Greens and liberal Free Democrats, led by either the Social Democrats or Merkel’s conservatives.
A new coalition could take months - and Merkel will remain in charge in a caretaker role while Scholz and Laschet court the support of the smaller parties.
They have both said they aim to form a coalition before Christmas.