GERB will try to form a coalition government at a time when Bulgaria is arguing with neighbouring Turkey, and seeking to balance its EU interests with those of Russia.
Bulgaria's centre-right GERB party narrowly won a parliamentary election on Sunday. It now has a chance to form another government after leader Boiko Borisov resigned as prime minister in November, triggering the snap poll. The election was the third in just four years for the Balkan country.
With almost 90 percent of votes counted, the GERB led with 33 percent of the vote. The Socialist party (BSP) was in second place with 27 percent of the vote, followed by the the nationalist alliance United Patriots with 9 percent, according to the latest count. The ethnic Turkish MRF party will enter parliament, after it scored 8.9 percent, as will the populist Will party, which scored 4.1 percent of the vote so far.
Final official results are expected on Thursday.
Bulgaria accused Turkey of interfering in its internal politics by sending Bulgarian ethnic Turks to vote. Ankara says that Sofia is pressuring the minority living there.
Bulgarian nationalists blocked border checkpoints with Turkey in an effort to stop buses bringing Bulgarian ethnic Turks to vote in Sunday's election.
TRT World 's Nicole Johnston has more from the Bulgarian capital, Sofia.
Creating a coalition could be difficult
The election is being seen as a test of Bulgaria's loyalties to the European Union, which it joined in 2007, and to Russia, with which it has historic political and cultural links.
But political analysts are sceptical the results can lead to a government able to uproot widespread corruption in the EU's poorest member state.
If Borisov, 57, succeeds in forming a new coalition, it is likely to maintain the tight fiscal policies that underpin the lev currency's peg to the euro.
GERB is expected to court the United Patriots nationalist alliance, which came third with 9.6 percent of the vote.
The United Patriots has built its popularity on anger about the flow of migrants from the Middle East, Africa and Asia trying to reach Western Europe via the Balkans.
Socialist leader Kornelia Ninova, 48, conceded defeat in the election but said she would look at options for forming a government in case GERB cannot do so.
The Socialists had pledged during campaigning to raise wages and pensions, as well as oppose continuing EU sanctions against former Soviet-era overlord Russia.
That would complicate relations with Bulgaria's EU peers — already grappling with Britain's move to leave and the rise of anti-establishment parties across the bloc — as it gets ready to take over the EU's six-month rotating presidency in January.
Borisov resigned after a GERB candidate lost a presidential election in November to Rumen Radev, a Russia-friendly ally of the Socialists.
Bulgaria is currently being run by a caretaker administration.