Jimmie Akesson Sweden Democrats
Jimmie Akesson gives the thumbs up in front of a poster that reads 'Sweden's third largest party' at the election night party of the Sweden Democrats in StockholmReuters

A far-right, anti-immigration party scored an impressive result at Sweden's parliamentary election, signalling that even Europe's most tolerant nation was not immune from nationalism.

The Sweden Democrats won 13% of the vote, securing 49 seats in the 349-seat parliament, and has become the country's third-largest party.

"We're the absolute kingmaker in parliament now," said 35-year-old party leader Jimmie Akesson.

But the vote has left the country without a clear parliamentary majority.

The centre-right ruling coalition of outgoing Prime Minister Fredrik Reinfeldt won 39.3% of votes, while the opposition centre-left bloc led by the Social Democrats of Stefan Lofven won 43.7%.

Lofven, who is expected to become PM, has ruled out an alliance with the Sweden Democrats.

Nevertheless, the far-right party is still to hold a considerable influence over parliament as the centre-left bloc might have to look for consensus among MPs on the opposite side of the political spectrum on a case-by-case basis.

Who are the Sweden Democrats?

The Sweden Democrats were founded at the end of the 1980s and the party has its roots in the Scandinavian neo-Nazi, supremacist movements.

One of the party's early prominent figures was Gustaf Ekström, who had been a member of Nazi-era Waffen SS, the Telegraph reported.

For years the Sweden Democrats remained a fringe pariah political group, polling at less than 1%.

In 1995, it started a process of deradicalisation, akin to the de-demonisation underwent by France's National Front under the lead of Marine Le Pen, and set its course to mainstream acceptance.

The process was speeded up as the youthful Akesson became party leader in 2005.

Aakesson ditched the traditional party logo - a National Front-style torch - and replaced it with a family friendly baby-blue daisy.

Openly racist members were expelled and the party rhetoric softened, focusing on tightening Sweden's loose immigration policies.

Sweden arguably has Europe's most generous refugee policy, as, for example, it grants automatic residence to all refugees fleeing the Syrian civil war and is expecting to take in approximately 80,000 asylum seekers in 2014.

Akesson's clean-up strategy yielded positive results in 2010, as the Sweden Democrats entered parliament for the first time.

However, under his nine-year leadership, the party has not been completely immune from controversies and scandals related to toxic refuses from some of its members' past neo-Nazi links.

In the run up to the latest election, one candidate was forced to step down after photos of him wearing a swastika armband emerged, according to reports from the BBC.

In 2010, Sweden Democrats was accused of Islamophobia for a TV advertising campaign that featured a frail white pensioner losing a race for the country's money to a half-a-dozen burka-clad women pushing prams (see video below).

The European Jewish Congress called the Sweden Democrats' latest election result a "wake-up call for Sweden and the rest of Europe".