The head of the Iranian state electoral commission said Mahmoud Ahmadinejad was leading in Friday's presidential poll with 69 percent of the vote with about 19 percent of the ballots counted.
However, challenger Mirhossein Mousavi had earlier said he was the "definite winner" and complained of voting irregularities.
Iran's official IRNA news agency said President Mahmoud Ahmadinejad won most votes of the ballots counted in Friday's presidential election.
"Doctor Ahmadinejad, by winning most votes at the 10th presidential election, has secured his victory," IRNA said.
Voters had been queuing to cast their ballot in Iran’s tenth presidential election after a heated campaign pitting incumbent Ahmadinejad against his reformist rivals.
"Voter turnout has been unprecedented," electoral commission chief Kamran Daneshjoo said at a press conference, with long queues reported at polling stations. The Interior Ministry said it expected a turnout of more than 70 percent and polling stations remained open for an extra four hours - so that voters could cast their ballot.
Four candidates were standing in the poll but Ahmadinejad’s strongest challenger appeared to be ex-premier Mirhossein Mousavi, who is hoping to stage a political comeback. Former parliament speaker Mehdi Karroubi and the ex-head of the elite Revolutionary Guards Corps, Mohsen Rezai, appeared to be trailing the two frontrunners.
Supreme leader Ayatollah Ali Khamenei urged Iranians to remain calm after an unusually impassioned election campaign marked by raucous street demonstrations. “Everybody go and everybody vote and act based on their judgment,” Khamenei told state television.
A high-stakes election
With official inflation hitting 15 percent, the election was a chance for Iranians to pass judgment on Ahmadinejad’s management of the country’s economy. While Mousavi has sharply criticised his economic record, Ahmadinejad says his government has helped revive Iran’s growth.
However, Los Angeles Times correspondent Borzou Daragahi says Iranians will also have to mull over their national identity when they cast their ballot. They will have to decide “whether [they want] to go back to the core values of the Islamic Revolution or whether [they] want to reach out to the outside world and become a ‘normal’ country,” he said.
The three-week election campaign highlighted a glaring internal divide, with towns and villages passionately backing Ahmadinejad and young men and women in big cities throwing their weight behind Mousavi.
During the campaign, Ahmadinejad and his rivals clashed in televised debates that electrified Iranian viewers, and even sparked minor clashes in Tehran between candidates’ supporters.
Women, young people get involved
Reporting from Tehran, Le Figaro correspondent Delphine Minoui notes that many women and youth have turned out to cast their ballot. “It was especially surprising to see how many young people and women have come out – these are the very people who had boycotted the election in 2005 and encouraged the election of Mahmoud Ahmadinejad,” she said.
Iran’s youth have been especially involved in the campaign, taking to the streets in raucous demonstrations to show their support for their favourite candidates.
Social issues, such as strict dress codes for women and Iran's ties with the outside world, also featured in the campaign, but the outcome of the vote will not shift Iran's foreign policy, which is determined by Khamenei.
The United States broke off all ties with Iran shortly after the 1979 Islamic Revolution and remains the "Great Satan" in the leadership's demonology. On Friday, US President Barack Obama said that there was "a possibility of change" in US-Iran relations and welcomed the "robust debate" taking place in Iran.
Mousavi, who supports Iran’s pursuit of peaceful nuclear energy technology, has rejected Western demands that Iran halt uranium enrichment. But analysts say he would bring a different approach to Iran-US ties and Tehran's nuclear programme, which the West fears is a cover to build a nuclear arsenal.
If no clear winner emerges when election results are published on Saturday, a run-off vote will be held on June 19 between the two main candidates.