The Bharatiya Janata Party (BJP) was headed for election defeat in New Delhi at the hands of the anti-corruption Aam Aadmi Party (AAP), as counting of votes began on Tuesday morning (10 February) - the first blow for Prime Minister Narendra Modi since he swept to power last year.
Winning power in India's states is critical to gain control of the upper house of parliament, where Modi's party lacks a majority and has been thwarted in its effort to move reform legislation, including wider opening of the insurance sector.
However, Delhi is a small, although high profile, state and the BJP, which has won a string of big states over the past several months is looking to capture power in the second most populous Bihar, the next state set for an election later this year.
The AAP or Common Man Party, campaigning on pro-poor policies, was leading in 45 of the 70 seats at stake in the capital, well over the simple majority of 36 required to rule.
The BJP, seen as a party of traders and big business, was ahead in 15 seats while Congress, which ruled Delhi for 15 years, led in three seats.
News channel NDTV said its projection showed the AAP would finally win 42 seats, securing a comfortable majority.
However, supporters of BJP's chief ministerial candidate, Kiran Bedi, said these were just trends.
The BJP said the Delhi election was a local poll and in no way reflected its strength in the rest of the country.