Greek President Karolos Papoulias has asked conservative Prime Minister Costas Karamanlis to form a new government after his party won a thin parliamentary majority in Sunday's elections.
Mr. Karamanlis has vowed to quickly go forward with necessary reforms that will allow the country to progress.
Official results show the prime minister's New Democracy Party holding 152 seats in the 300-member parliament -- a net loss of 13 from 2004. In its worst showing in three decades, the opposition socialist (PASOK) party won 102 seats, down from 117 three years ago.
The communist (KKE) party emerged with 22 seats, while the radical Left Coalition won 14. A new extreme-right party holds 10 seats.
Opposition leader George Papandreou conceded defeat early Monday, telling his supporters that voters have made their decision.
Mr. Karamanlis declared victory moments later as he spoke to thousands of New Democracy supporters in Athens. He said voters gave him a clear mandate to continue reforms.
The prime minister called Sunday's election six months early, confident that his economic record would keep his party in power. But he had to battle strong opposition protests in the aftermath of devastating wildfires that killed at least 65 people and ravaged much of the country last month. Critics accused the Karamanlis government of failing to respond adequately to the disaster.
Some information for this report was provided by AFP, AP and Reuters.