Australiain Prime Minister John Howard has conceded defeat in the country's general election.
With 70% of votes counted, the Labor party is on course to win the 76 seats it needs to form a government.
This has propelled 50-year-old former diplomat Kevin Rudd into office on a wave of support for generational change.
The surge to Labor left conservative Prime Minister John Howard struggling to hold on to even his own parliamentary seat. He has held this seat since 1974. He is in danger of becoming the first prime minister since 1929 to lose his constituency.
Mr Howard, who had won four consecutive elections lost power in front of a crowd of supporters in Sydney and said that he phoned Mr Rudd to congratulate him on Labor's victory.
'This is a great democracy and I want to wish Mr Rudd well. He assumes the mantle of the 26th prime minister of Australia,' Howard said. 'We bequeath to him a nation that is stronger and prouder and more prosperous than it was 11 and a half years ago.'
Kevin Rudd presented himself as a new generation leader compared with Mr Howard, 68, promising to pull Australian combat troops out of Iraq and sign the Kyoto Protocol on climate change.
Mr Howard was Australia's second-longest serving prime minister behind Liberal Party founder Sir Robert Menzies. He had trailed in opinion polls all year.
