In one of the narrowest elections in years, the liberal-conservative Moderate, Center, Liberal, and Christian Democrat parties just came out ahead of the ruling Social Democrats, and their Left and Green party allies.
In his concession speech, Göran Persson announced he will be resigning his position as leader of the Social Democrat Party.
The Alliance received 48 percent of the vote, which translates into 178 seats in parliament.
The Social Democrats and their allies have 46.2 percent, and 171 seats.
None of the small parties outside of parliament seem to have gotten the 4 percent needed for representation. But the xenophobic Sweden Democrat party has increased its vote in southern Sweden and seems to have gotten representation in the regional assembly in Skåne and the county council in neighboring Blekinge. The party has also done well in municipal elections in southern Sweden.
The opposition alliance parties seem to have regained control over Stockholm city hall, with 48.1 percent of the vote, compared to 44.7 percent for the S, L, and Greens.
Turnout was slightly better than in 2002, at just over 80 percent.