Conservatives won a majority in Iran's parliamentary vote, state television said on Sunday, but the new assembly may still give President Mahmoud Ahmadinejad a tougher time ahead of next year's presidential election.
The hardline president's reformist critics had tried to capitalise on public discontent over inflation in the world's fourth-largest oil producer but many of their leading candidates were disqualified from the race.
State-owned Press TV said the conservatives, who call themselves "principlists" for loyalty to the Islamic Republic's ideals, have taken at least 163 seats in the 290-member assembly against 40 for the reformists so far.
The English-language satellite channel, citing the Interior Ministry, said most votes had been counted. Some seats would go to run-off votes and some winners were classified as independents.
Iranian officials have hailed the election as a victory over the United States, the Islamic Republic's arch-foe, which on the day of voting on Friday called the vote result "cooked".
But the European Union, whose main members back the United States in an escalating standoff with Tehran's over its disputed nuclear plans, said the election was "neither fair nor free."
The Guardian Council, a body of clerics and jurists, barred many reformists when it screened potential candidates on criteria such as commitment to Islam and the clerical system.
The 27-nation EU "expresses its deep regret and disappointment that over a third of prospective candidates were prevented from standing in this year's parliamentary elections," its presidency said in a statement issued in Brussels.
Iran's Interior Ministry, which supervised the vote, has said a final nationwide tally might not come out until Monday.
But even if the conservatives' victory is confirmed, analysts said divisions among politicians ranging from radical backers of Ahmadinejad to his more pragmatic critics could widen as they jockey for position before the 2009 presidential race.
Reformists, who seek political and social change, and some conservatives have accused the president of stoking inflation, now at 19 percent, by lavishly spending Iran's windfall oil revenues on subsidies, loans and handouts.
"You could have a possibility of some of the conservatives making a coalition with the reformists and making it difficult
for the president to pass his bills," one Iranian analyst said.
Pro-reform politicians have also rebuked Ahmadinejad for speeches that have kept Iran on a collision course with the United Nations over Tehran's nuclear programme.
However, Ahmadinejad has won public backing from Iran's top authority, Supreme Leader Ayatollah Ali Khamenei, who has endorsed his handling of the nuclear row.
Iran's leaders had called for a high turnout as a show of defiance for its "enemies" in the West: "The U.S. was the real loser and it was the Iranian people ... who emerged victorious," Foreign Ministry spokesman Mohammad Ali Hosseini said.
Washington has led international efforts to penalise Iran for failing to allay suspicions that it is seeking nuclear weapons. Tehran says its nuclear programme is purely civilian.