Senator Barack Obama and former Arkansas governor Mike Huckabee have emerged the victors in Iowa Thursday, winning the presidential caucuses.

Obama, a first-term senator, won with a significant lead over his main rival and Democratic front-runner, Senator Hillary Rodham Clinton. Senator John Edwards came in second but Clinton came in at a very close third while votes were being tallied.

Meanwhile, Huckabee, a Baptist preacher-turned politician, won the Republican caucus. He defeated Massachusetts governor Mitt Romney. Former senator Fred Thompson and Senator John McCain were in a tight race for third place.

Going into Iowa, the first big test of the presidential race, Huckabee and Romney were neck-and-neck in the polls.

Although Romney outspent Huckabee by about $20 to $1, the former governor had the support of more than half of Republican voters in Iowa who said in entrance polls they were either born-again or evangelical Christians.

Romney said that despite the loss, he was satisfied with the gains he made in the polls.

"I've been pleased that I've been able to make up ground and I intend to keep making up ground, not just here but across the country," he said.

According to her aides, Clinton called Obama to congratulate him. But her campaign manager said the fight for presidency was far from over.

"This race begins tonight and ends when Democrats throughout America have their say," she told The Associated Press. "Our campaign was built for a marathon and we have the resources to run a national race in the weeks ahead."

Political pundits said Obama's win in an overwhelmingly white state is a great triumph as he tries to become the first African-American president of the United States.

Now, the dynamic of the race has shifted for Clinton who also hopes to make her mark by being the first female president of the U.S.

Tight race

Earlier Thursday, Democrat and Republican candidates vying for first place in Iowa's presidential caucuses didn't waste a minute trying to reach voters with their message.

"This thing could really be close," Senator John Edwards told his supporters in Iowa City. "This thing could be really close. We need you to make calls, talk to your friends."

Tom Clark, CTV News' Washington bureau chief, said Edwards' campaign is in a lot of trouble.

"He's been campaigning here virtually for four years. His whole strategy said he had to win Iowa," Clark told CTV News. "He didn't win Iowa tonight. Edwards is in a lot of trouble."

Clark said the night's biggest loser turned out to be former mayor of New York City Rudy Giuliani, who is running as a Republican candidate.

"He virtually ignored Iowa and guess what, tonight Iowa ignored Rudy," he said.

Iowa is the first state contest on the road to the party nominations and the official start of what is expected to be the longest White House race in history.

While the state is tiny and the voter numbers low, political analysts such as presidential historian Allan J. Lichtman say Iowa matters because it can make or break a candidate's chances in the other 49 states.

"You know, Iowa is all about expectations," he told CTV's Canada AM Thursday. "And nobody cares about the handful of delegates that are selected. The only thing that matters is the story that's going to be written the day after the Iowa caucuses."

Huckabee decided to take the unusual step of leaving Iowa and to make an appearance on Jay Leno's Tonight Show on Wednesday.

Huckabee played up his personable side, jamming on his bass guitar with Leno's band and trading jokes with the host.

Lichtman noted that Huckabee had a lot riding on tonight's outcome.

"If Romney wins Iowa and then New Hampshire, he could well be the Republican nominee," he said

High voter turnout crucial

Over in the Democratic race, Clinton made a last-minute appeal for support Wednesday, telling supporters her experience makes her the most effective leader.

"Long before cameras started following me around I worked to try and do what I could to make positive change to improve people's lives," she said.

Obama quickly rejected that notion.

"You can't be steeped in the conventional wisdom of Washington on issues as profound as war and then somehow believe you're going to chart a new bold direction on foreign policy," he said.

Clark also notes that that the candidates have had to customize their campaigns for the unique perspective of Iowa voters.

"The interesting thing about these races is this is not the general population that's voting. These are the party activists, the committed people, the committed Republicans, and committed Democrats. And they tend to come from special interest points of view.

"And so the candidates play to that. And they do that process throughout the primaries and then of course their campaigns change when they appeal to the general voter."

About US$40 million has been spent on campaigning in Iowa, which averages out to be more than $400 for each voter expected to attend the caucuses.

The figures could make this the first-ever billion-dollar presidential election.

The Canadian connection

Canadians are overwhelmingly supportive of Democrat candidates, said Peter Harder, Canada's former deputy minister of foreign affairs.

Of the Democrat candidates, Clinton is the one that knows Canada the best but she's far from being the country's best friend, said Peter Donolo with the Strategic Counsel.

"She's particularly tough on Canada," he said. "She's been anti-Canada when it served her political purposes."

As for Obama, he isn't too well-versed in Canadian politics.

"I would immediately call the president of Mexico, the president of Canada to try and amend NAFTA," he once said.

Democrats aren't too keen on the free-trade agreement, which could spell trouble for Canadian jobs.

With files from The Associated Press, The Canadian Press and reports from CTV's Tom Clark and Robert Fife