With half the votes counted, the Fatherland, Reform and the Moderates have 53 seats in the 101-member parliament, known as the Riigikogu, officials said.

Voters were faced with a bewildering choice of candidates

The opposition parties favour continuing the market-oriented reforms that have made Estonia the economic success story of the former Soviet Union.

The partial results showed that the most seats - 29 - have gone to the Centre Party headed by of former premier Edgar Savisaar. But the party, which is wooing the vote of those hit hard by the market reforms, has only one clear ally, the Rural Union which has only won 10 seats.

Nearly 2,000 candidates from 12 parties stood in the elections, the third since independence was restored in 1991.

'No big brother'

Moderates leader Toomas Ilves said the centre-right's apparent victory showed "Estonians have said yes to the West, yes to the European Union, no to populism and simple solutions and no to Big Brother".

Darius Dazargan in Tallinn: "Confirmation of Estonia's status as an independent modern European democracy"

His remark was a barbed reference to the authoritarian image of Mr Savisaar - the first post Soviet prime minister.

The three-party alliance was expected to reach out to outgoing Prime Minister Mart Siimann's Coalition Party to pick up the extra nine seats needed to bolster the majority.

The BBC correspondent in Tallinn, Darius Bazargan, says the election seems to have passed off smoothly with campaign managers and election officials giving the impression of people who are pleased with their day's work.

Digital democracy

Estonia is by far the wealthiest of the three Baltic states and its next government is likely to lead negotiations for the country's entry into the European Union and Nato.

Nearly 2,000 candidates are competing for 101 seats in the parliament

It is the only former Soviet republic to be invited by the EU to begin detailed membership negotiations.

The results process was speeded up by the introduction of a system allowing regional polling stations to deliver their counts to the central election committee via the Internet.

The introduction of digital phone lines across the country mean the counting can now be almost fully automated and hence less prone to failure than the previous manual process.

Economic downturn

The final structure of Estonia's next government is expected to be known by the middle of March and the new parliament will be convened by President Lennart Meri 10 days later.

Voting cards remain but much of the counting process has gone high-tech

Whoever forms the new government will have to cope with a worsening economic downturn caused partly by the financial problems in neighbouring Russia.

There have also been questions about the treatment of the country's ethnic Russian minority who moved to Estonia when it was part of the Soviet Union and number around a quarter of the 1.5 million population.

Many are denied voting rights by Estonia's strict citizenship laws, which demand that they pass a stringent Estonian language exam.

Two parties - the Russian Party and the United People's Party - are standing in the campaign to represent the interests of the Russian speaking community.