Iranian President Hassan Rouhani won an emphatic vote of confidence and reformist partners secured surprise gains in parliament.
The early election results could accelerate the Islamic Republic's emergence from years of isolation.
While gains by moderates and reformists in Friday's polls were most evident in the capital, Tehran, the sheer scale of the advances there suggests a legislature more friendly to the pragmatist Mr Rouhani has emerged as a distinct possibility.
A loosening of control by the anti-Western hardliners who currently dominate the 290-seat parliament could strengthen his hand to open Iran further to foreign trade and investment following last year's breakthrough nuclear deal.
A reformist-backed list of candidates aligned with Mr Rouhani was on course to win all 30 parliamentary seats in Tehran, initial results released today showed.
Top conservative candidate Gholamali Haddad Adel was set to lose his seat.
"The people showed their power once again and gave more credibility and strength to their elected government," Mr Rouhani said, adding he would work with anyone who won election to build a future for the industrialised, oil-exporting country.
The polls were seen by analysts as a potential turning point for Iran, where nearly 60% of its 80 million population is under 30 and eager to engage with the world following the lifting of most sanctions.
"Based on the votes that we have so far it looks like the principlists will lose the majority in the next Majlis (parliament) shy of 50%.
The reformists gained 30% and independent candidates did better than before, gaining 20%," said Foad Izadi, an assistant professor at the Faculty of World Studies in Tehran University.
Principlists, otherwise known as hardliners, hold 65% of the outgoing parliament and the rest is divided between reformists and independents who traditionally support Mr Rouhani.
Top Iranian pro-reform politician Akbar Hashemi Rafsanjani said on Twitter today that no one could resist the will of the people.
"No one is able to resist against the will of the majority of the people and whoever the people don't want has to step aside," the message said.
Former president Mr Rafsanjani, an ally of Mr Rouhani, is leading the race for membership of the influential Assembly of Experts, a body that chooses Iran's most powerful figure, the supreme leader.
