The center-left Social Democrats have narrowly beaten outgoing chancellor Angela Merkel's center-right bloc in a closely fought election according to preliminary results.
SPD leader Olaf Scholz says he has a clear mandate to form a government, but his conservative rival, Armin Laschet, is determined to fight on.
The two parties have governed together for years but are unlikely to continue.
Instead the Greens and liberals are looking for a role in a new coalition.
Let's take a step further.
I want to bring in Tim BUTHE, Professor of International Relations at the Technical University of Munich. Welcome to the show.
First, could you explain how the German federal elections work? The voters don't vote the Chancellor directly, but the party in the parliament, so-called Bundestag, of about 700 seats.
With no one party gaining a majority of the seats in the Bundestag, a coalition government is inevitable.
Coalition negotiations could take weeks, or even months.
What are the characteristics of SPD - as the leading party in Germany, apart from the second leading party Christian Democrats (CDU/CSU) of Merkel?
The Social Democrats must team up with other parties to form a government. And the outgoing Chancellor Merkel is staying until the coalition is formed - maybe until Christmas.
With no one party gaining a majority of seats in the Bundestag, a coalition government is inevitable, but which party will lead a coalition government and who will be Germany’s next chancellor is up in the air.
What are your prospects?
The voters' choice will shape Germany's policies, and, by extension, Europe's - on the social safety net like pension, taxes, innovation and climate change. And the successor's task is to lead Europe's foremost economy over the next four years with it. What do the voters who used to prefer "stability" want now for a change from the Merkel's era?
Merkel is stepping down after 16 years as chancellor and her conservative alliance is heading toward its worst election result since World War II.
Since Angela Merkel was not just chancellor of Germany but effectively the leader of Europe for over a decade, now what are the challenges for the new government in the times of pandemic, France having its own elections in 2022, and the Biden administration re-forming alliances against China?
Professor Tim BUTHE on the German elections for us tonight. Thank you.