Projections by Israel's three main TV stations showed acting Prime Minister Ehud Olmert's centrist Kadima Party winning Israel's election today, but not by enough to govern alone.
Ehud Olmert looks set to lead a new left-wing Israeli coalition government
The centre-left Labour Party, a likely coalition partner for Mr Olmert, came in a strong second.
The hardline Likud, which dominated Israeli politics for three decades and opposes Mr Olmert's plan to withdraw from much of the West Bank, came in a distant third, according to the projections, broadcast immediately after polls closed.
According to the projections, Kadima will win between 29-32 seats in the 120-member Knesset. Labour was given 20-22 seats, and Likud just 11-12 seats.
If confirmed by final results, the projections mean Mr Olmert could likely form a centre-left coalition to carry out his plan of drawing Israel's final borders by 2010.
Speaking after the announcement of projections Defence Minister and Kadima Party member, Shaul Mofaz said: "In any final outcome, this is a victory for Kadima. Kadima will form the government. The intention is to fulfil all of our commitments to the voters."
Reaction from Palestine's ruling party Hamas was predictably guarded.
Interim prime minister Ismail Haniyeh said whoever was installed "should be brave to recognise the rights of our people in establishing their full sovereign state with Jerusalem as its capital and to free male and female prisoners in their jails and to recognise the right of return."
Near-final results should be available early on Wednesday.