The future of Sri Lanka's fragile peace process now hinges on how President Chandrika Kumaratunga's winning political alliance and the Tamil rebels heal rifts within their own ranks.
Analysts believe that the island's two-year-old ceasefire will continue to hold in a war-weary nation.
But the Tamil rebels are grappling with a split after the commander in the eastern part of the country broke away from the northern leadership.
In addition, President Kumaratunga's new ruling coalition is an unlikely and disparate alliance of parties who differ on ways to resolve the conflict.
The coalition includes orthodox Communist, left-of-centre Sinhala nationalist and minority Muslim parties, but all eyes will be on the JVP (People's Liberation Front), a key partner.
The Sinhala nationalist JVP, is made up of former left-wing revolutionaries. This is the first time it has been in government.
President Kumaratunga faces a fresh challenge
It has a violent past. It has twice tried to overthrow the government of the day by armed revolt.
President Kumaratunga's party believes in political devolution for the Tamils as a way to resolve the civil war, which has raged for more than 20 years now.
This is where the JVP differs. It believes in administrative decentralisation for Tamil-dominated regions, and nothing more.
"We believe federalism or devolution of power has nothing to do with this problem. What is important is to restore democracy and equality," JVP leader Somawansa Amerasinghe told the BBC.
Meanwhile, it's unclear whether the Tamil rebels will be keen to talk to the president.
"It will be interesting to see whether the Tamil rebels will talk to the new government, considering their dislike for Mrs Kumaratunga and the person who she is likely to nominate as her prime minister," says analyst Rohan Edrisinha.
Many believe Lakshman Kadirgamar, a former foreign minister who once lobbied internationally for restrictions on the rebels, is a strong candidate to be the PM.
"I think we are headed for a period of stagnancy as far as the peace process is involved," says analyst Jehan Perera.
"Both sides are divided on how to solve the conflict. The ruling alliance also does not have a successful track record of dealing with the Tamil rebels," he says.
Janadasa Peiris, a spokesman for the ruling coalition, agrees that the JVP and President Kumaratunga's party have "two positions" on the peace process.
But Mr Peiris says this will not hinder further talks with the rebels.
"The President has supported peace talks, and the JVP is prepared to continue them too. I believe that the new government's talks with the rebels will begin within months of its swearing in."
He's sure that if the talks result in several ways to resolve the conflict, the ruling alliance will hold a referendum to let the public have their say.
But analysts believe that it is easier said than done.
They say the inherent incoherence of the ruling alliance and the presence of a number of assertive, extremist parties in the parliament could make
consensus harder on the peace process - or even ways to reform the economy.
The JVP, for one, won 40 out of the 105 seats for President Kumaratunga's United Freedom Alliance party.
The Tamil National Alliance, a group of Tamil parties who are politically close to the rebels and had their support during the elections, got 22 seats.
The National Heritage Party of the Buddhist monks, which believes in a 'righteous society', won nine seats.
"The election shows up Sri Lanka as a fractured society. Centrist parties haven't done well. Extremist, off-mainstream parties have come to the
parliament, says political scientist Jayadeva Uyangoda.
"The real challenge is to bring these divided, fragmented parties together to build a consensual political system which is urgently needed for
the stability of the country and its peace process," he says.
Others believe that Mrs Kumaratunga's government might be better placed to deal with the peace process because it has a broader majority Sinhala
"That's one way of looking at it, but since it is likely to be a minority government, it isn't going to be easy," says Paikiasothy Saravanamuttu, who
heads the Colombo-based Centre For Policy Alternatives.
"I think the peace talks will be on hold till the alliance sorts out its own internal contradiction," he says.
Janadasa Peiris of the United Freedom Alliance party disagrees.
"The rebels have indicated that they are willing to talk to any government. " he says. "So talks should start in three to four months. Our party wants the talks within a time frame,"
Some analysts believe that is wishful thinking.
"The best we can hope for is some sort of a moratorium of the peace process. The process will be kept in suspended animation, and the ceasefire will continue," says Jehan Perera.
The next few months will prove whether this election was, as some analysts believe, partially a referendum against the peace process - or at least the way the former government of Ranil Wickremasinghe dealt with it.