Italy appears headed toward an unprecedented split in parliament between Italian Prime Minister Silvio Berlusconi's conservative coalition and his centre-left challenger, Romano Prodi.

Both sides are in a deadlock in Monday's national election, with Prodi claiming a razor thin victory in both houses of parliament -- a claim which Berlusconi disputes.

Final results in the two-day vote ending Monday showed:

• 49.8 per cent of the vote for Prodi's centre-left coalition winning control in the lower house of parliament; and
• 49.7 going to Berlusconi's conservatives.

The winning coalition is automatically awarded 55 per cent of the seats, according to a new electoral law.

The results show Berlusconi's coalition held a one-seat lead in the Senate. Six seats elected abroad, however, were still to be counted.

"We have won, and now we have to start working to implement our program and unify the country," Prodi told his supporters.

But Berlusconi's spokesman contested the claim -- and allies of Prodi conceded that results in the Senate were still not complete.

The Senate and lower chamber of parliament have equal powers, and in order to form a government, any coalition would have to control both.

Leaders of both sides have stated if neither side controls both houses, new elections should be called.

"If there's a different majority between the Senate and the chamber we need to go back to the polls," leading centre-left legislator Luciano Violante said earlier in the day.

Voter turnout was about 84 per cent, according to the Interior Ministry.

Even with a slim majority in parliament's houses, a coalition would officially win. But it would find it difficult to pass legislation.

If parliament is split between the two coalitions, the president could try to name a government of technocrats -- at least until another election is held. He also could seek to fashion a coalition of left and right, but that seemed unlikely given the bitter divisions among Italy's political parties.

Berlusconi, 69, is the longest-serving prime minister since the Second World War. The billionaire founded a business empire that expanded to include Italy's main private TV networks, the Milan soccer team, and publishing, insurance and advertising groups.

During his tenure, Berlusconi has failed to jump-start a sagging economy. He was battling to capture his third term with a coalition of his Forza Italia party, the former neo-fascist National Alliance, pro-Vatican forces and the anti-immigrant Northern League.

While Berlusconi is a staunch U.S. ally, the 66-year-old Prodi is an economist who wants to tone down Rome's strong relationship with Washington.

The economics professor and former European Union chief joined forces with Greens, liberals, moderate Christian Democrats, Communists and former Communists.

After five tumultuous years under Berlusconi, which included verbal outbursts and the threat of corruption indictments, Prodi appealed to voters in a different way using slogans that presented him as an average man who would bring "seriousness to the government."

Berlusconi quieted a potentially significant election issue when he announced before the campaign troops would be pulled out of Iraq by the end of the year.

He strongly supported U.S. President George Bush over Iraq despite fierce public opposition to the war.

Prodi has said he would bring troops home as soon as possible.

He also promised a change of direction in Italy's foreign policy and said he would raise his country's profile in Europe.

Berlusconi depicted Prodi as a front man for Communists who would damage Italian democracy.

Italian voters headed to the polls Sunday and Monday using a proportional system, thanks to a law pushed through by Berlusconi's government to increase the chances his smaller allies would win seats in Parliament.

With files from The Associated Press