By Gary Duffy
BBC News, Asuncion
Paraguayans weary of corruption and inequality celebrated
The party that continued well into the night on the streets of Asuncion felt like a celebration of democracy at work.
Jubilant supporters of the victorious opposition presidential candidate Fernando Lugo packed the streets waving flags and banners and singing songs as it became clear not only that he had won, but that the victory would be respected.
After 61 years of continuous rule by the same party this was a moment the opposition wanted to savour. It was almost as if they could not believe the scale of their achievement.
It seems they were joined by many ordinary Paraguayans weary of corruption and poverty in their society, and who felt that Fernando Lugo embodied the idea of change.
"I feel happy, happy, after 60 years of slavery, 60 years of frustrations, 60 years of opportunities just for one group," one man told the BBC.
"This had to end eventually and God sent us this man to liberate us."
When Mr Lugo came to speak to the people on the streets it almost seemed as if, in their enthusiasm, the crowd would sweep the former bishop away.
Earlier he paid an emotional tribute to his supporters at his campaign headquarters.
"You are responsible for the happiness of the Paraguayan people today," he said.
"Today we can say that small people can also win. This is the Paraguay of my dreams. The Paraguay that is of all colours and all faces, everyone's Paraguay. This Lugo has a heart and he loves you a lot."
The significance of the moment was acknowledged by sitting President Nicanor Duarte from the ruling Colorado Party, who congratulated the people for the conduct of the election.
"For the first time in our history, one party will transfer power to another without a coup, without bloodshed and without
fighting among brothers."
Mr Lugo faces major challenges in meeting voters' expectations
His party's candidate, Blanca Ovelar, also acknowledged defeat, her campaign undermined by internal divisions and the sheer desire for change in the country, a mood she was unable to capture.
The Colorado Party, which for many people had been synonymous with the state, had been its own worst enemy with bickering continuing in public up to and including election day.
In the end, even the most controversial candidate, former general Lino Oviedo, could not halt the momentum towards Fernando Lugo.
Mr Oviedo, whose sentence for plotting a military coup was overturned last year, was quick to acknowledge his opponent's victory.
Fernando Lugo has inspired hope among many of Paraguay's citizens and now faces the challenge of delivering on those expectations.
While the Colorados could not retain their majority in the Senate, the new president will need to forge alliances to push his programme through the Congress.
There will have to be difficult discussions with Brazil and Argentina about whether Paraguay gets a fair deal for the hydro-electric power it sells to them.
And with high levels of unemployment and poverty, which have forced many of his people to live abroad, the new president faces a daunting task when he takes office in August.
But those concerns will have to tackled later.
Paraguayans have long been gently mocked for living in a country where not much happens.
But for one night there was chance to celebrate when it felt to many of those who live here like their story was the most important in the world.