Both candidates pounced on the slow read-out of votes to proclaim they had thrashed their rival and would become the next prime minister, to take office on 19 October.
With only 60 of the 217 national assembly seats officially counted, Ms Bhutto was in the lead with 27 seats, six seats ahead of the Muslim League. Mr Sharif was nevertheless celebrating victory in his native town of Lahore. 'A majority of the seats were won by the Pakistan Muslim League. We have won the elections,' he crowed. Mr Sharif bases his victory boast on a rough count taken by his party workers when votes were counted in 34,000 polling stations across the country.
In her ancestral home of Larkana, a normally loquacious and confident Ms Bhutto was less than jubilant. Even before first results were announced, her party issued a statement complaining of electoral fraud. 'It was clear that some of the presiding officers (at polling stations) were openly subverting the sanctity of the poll to the detriment of the Pakistan People's Party,' the statement read.
She refused to see the press and locked herself in with her closest advisers. She seemed worried by the surprising twist in developments. However, a PPP spokesman, Shafqat Mahmoud, eventually emerged from Ms Bhutto's inner sanctum to dispute Mr Sharif's victory claims. According to their rough count, it was Ms Bhutto who was heading for a clear majority.
Mr Sharif claims to have routed Ms Bhutto, his arch-enemy, in the crucial state of Punjab, where he calculates that his party won between 58 and 70 National Assembly seats. His advisers also claim to have made deep inroads in Ms Bhutto's home state of Sindh, long considered a family stronghold, as well as in Baluchistan and the North-west Frontier. But the PPP spokesman said: 'Mr Sharif is talking nonsense.'
Throughout the voting, army Jeeps mounted with machine-guns cruised by polling stations to prevent violence. Late forecasts had originally given Ms Bhutto's party a thin edge over Mr Sharif.
Past elections have often been bloody and crooked. But with the country's polling stations guarded by troops, the habitual gang warfare between the political parties has been absent. More than 60 people died in campaign shootings. But according to Maleeha Lodhi, editor of the daily News: 'These have been the most peaceful polls in the country's history.'
Most soldiers on election duty were dispatched to the southern state of Sindh, where the country's third largest party, the Mohajir Qaumi Movement, boycotted the polls. In Karachi, where the MQM is strongest, many polling stations were empty. From his London exile, the MQM party leader, Altaf Hussain, accused the army of harassing his supporters, mainly Muslim migrants from India.
Ms Bhutto cast her vote in Larkana, the rural home of the Bhutto dynasty in a women-only polling station. She stood out as the only unveiled woman in a sea of burkas, the traditional body- length veil worn by Muslim women. It illustrated how difficult her quest for political power has been in this male-dominated society, despite being the daughter and heir of Zulfikar Ali Bhutto, one of Pakistan's most charismatic leaders, who was hanged in 1979 after a military takeover.
The first woman prime minister in the Muslim world, Ms Bhutto was elected in 1988 but dismissed after 20 months by the autocratic president, Mr Khan, on corruption charges never proven. 'People want to give me a second chance,' she insisted.
Mr Sharif voted in Lahore as hundreds of admirers showered him with rose petals. A rich industrialist, he none the less has managed to capture the votes of Pakistan's aspiring urban lower-middle classes, who are deeply Islamic and conservative.