Officials reported huge turn- outs in the first elections since Dr Banda took office after Malawi became independent in 1964.
Steve Malilo, a voter in Blantyre, Malawi's commercial capital, waited in a huge queue to vote. He said: 'This is a defining moment in Malawi's history. For too long we were oppressed by (President) Banda, but I hope today we are electing a new government and opening a new chapter in our history.
'For the past three decades, this country has been ruled by a god surrounded by others also aspiring to be gods,' Malawi's Nation newspaper said, referring to Dr Banda.
'Today is a culmination of a battle between gods and mortals,' it added in a harsh front-page editorial that captured the mood of change that has swept Malawi since Dr Banda relaxed his iron grip two years ago.
Political analysts say Dr Banda, once revered as a virtual messiah for leading the country to independence from Britain 30 years ago, is likely to lose the presidential election. They tip Bakili Muluzi, the opposition leader who heads a grouping of pro-democracy campaigners and rebels from Dr Banda's Malawi Congress Party, to win.
Mr Muluzi, a 51-year-old former MCP secretary-general, is head of the United Democratic Front (UDF), which earlier this year teamed up with four smaller parties to contest the presidency. Two other opposition parties are fielding candidates in this poll.
In the parliamentary ballot, where 177 seats are at stake, eight parties, including the MCP and UDF, are taking part. The four parties that joined the UDF for the presidential poll are standing separately in the parliamentary poll.
Until two years ago Dr Banda, in his 90s and unwell, presided over Malawi as if it was his personal fiefdom, jailing hundreds of people at the slightest suspicion of disloyalty. Human rights groups say thousands of opponents were killed or disappeared as he fought to maintain his one-party rule. Mounting demands for democracy coupled with a cut-off in economic aid in 1992 forced Dr Banda to call a referendum to decide the country's future. Malawians backed multi-party politics in a stunning defeat for the President, paving the way for this ballot.Reuse content