BBC correspondent Karen Coleman says 70% of the electorate are expected to vote

Since polling stations opened early on Sunday morning, correspondents say the turnout has been high all over the country.

Voters are bitterly divided, mainly into two camps. One is made up of those supporting the reformist president Milo Djukanovic; the other backs his arch-rival, who is an ally of Slobodan Milosevic.

Montenegro is one of the two remaining republics in Yugoslavia. Despite its small size, it may have a huge influence on President Milosevic.

Opinion polls put Milo Djukanovic in lead

Opinion polls predict a narrow victory for the Mr Djukanovic's coalition, which is for economic reform and change.

Mr Djukanovic is a staunch opponent of Mr Milosevic.

If his supporters win enough seats, it could shift the balance of power in the upper house of the Yugoslav parliament - which is made up of members from Montenegro and Serbia - and allow Mr Djukanovic to challenge the authority of the Yugoslav president, Slobodan Milosevic.

Milo Djukanovic has accused the Balkan strongman of causing many of the region's problems and if given the power may try to vote President Milosevic out of office.

His main opponent in the elections is Momir Bulatovic, a close supporter of Mr Milosevic.

Recently-appointed Prime Minister of Yugoslavia by Mr Milosevic, Mr Bulatovic is confident his party will win, but so far polls predict he will lose by a narrow margin.

There are fears his supporters may protest if he loses. Last autumn, thousands of people demonstrated when Mr Bulatovic lost in Montenegro's presidential elections.