Democratic Unionist Party leader Arlene Foster says it appears to have been a "very good day" for main rivals Sinn Fein in the snap Assembly election.
With first round results declared in all 18 constituencies in Northern Ireland, the DUP topped the poll in terms of vote share but it led Sinn Fein by just 1,168 votes.
Turnout hit its highest level in almost two decades and this appears to have benefited Republicans Sinn Fein.
As counting continues in later rounds, possible extending into Saturday, the DUP may end up still being the largest party but with only one seat more than Sinn Fein, which made big gains and is set for its best performance.
The vote share of the centrist Alliance Party has also risen.
The DUP was on 28.1% (down 1.1% compared with 2016), with Sinn Fein on 27.9% (up 3.9%), the Ulster Unionists on 12.9% (up 0.3%), SDLP on 11.9% (down 0.1%), the Alliance on 9.1% (up 2.1%) and others on 10.2% (down 5.1%).
Former Northern Ireland first minister Mrs Foster told Sky News: "It looks like it has been a very good day for Sinn Fein."
She suffered a setback in Fermanagh and South Tyrone where she topped the poll but failed to reach the quota of votes in the first round. She secured her seat in the second round.
There was bad news for her running-mate in the constituency, Lord Morrow, who lost his seat, meaning Sinn Fein could even draw level with the DUP in terms of assembly seats.
Sinn Fein's leader in Northern Ireland and ex-health minister Michelle O'Neill (Mid Ulster) and Alliance Party leader Naomi Long (East Belfast) were among the candidates elected.
Ms O'Neill said: "I think it's a brilliant day for equality, I think it's a great day for democracy."
Meanwhile, Ulster Unionist leader Mike Nesbitt has quit after his party failed to make a breakthrough in the election.
Almost two-thirds of the electorate - 64.78% - voted in the poll triggered by the collapse of devolved government six weeks ago following controversy over a botched green energy scheme.
That is 10% higher than last year, with a total of 812,783 votes cast on Thursday.
The last time the turnout was as high was in the first Assembly election after devolution began, in June 1998, when 69.88% of the electorate cast their ballots.
Sky's Ireland Correspondent David Blevins said: "In Republican constituencies and in more moderate constituencies they came out in droves.
"They're very angry about Arlene Foster's handling of the renewable energy scheme and also about Brexit. Remember Northern Ireland voted to remain in the EU."
Some 228 candidates are contesting 90 seats in the Assembly at Stormont, five in each of 18 constituencies.
Plans to cut costs by reducing the number of seats from 108 in the 2021 election have been implemented early.
In the previous Assembly election last May, the DUP won 38 seats compared with Sinn Fein's 28, a 10-seat advantage.
Northern Ireland Secretary James Brokenshire MP called the snap poll when Martin McGuinness resigned as deputy first minister, ending power-sharing.
Parties have three weeks to agree to a new power-sharing administration or face the prospect of a return to direct rule.
Northern Ireland uses the single transferable vote - a form of proportional representation - to elect its members of the Legislative Assembly.
Unlike the first past the post system, it ensures the number of seats each party wins reflects its vote share.