Counting was under way after the UN-administered province's second general election since the 1998-99 war, but preliminary unofficial results showed Rugova's Democratic League of Kosovo retaining its place as the biggest party in parliament.
However, it may fall short of winning an overall majority.
UN mission chief Soren Jessen-Petersen hailed the vote as a key step in Kosovo's progress towards a multi-ethnic democracy, and dismissed the Serb boycott as the work of nationalists.
"Many have feared that Kosovo is unstable. But it has passed the test," he said after more than 1000 Nato peacekeepers were rushed to the province to secure the vote in the wake of bloody anti-Serb riots in March.
Independent estimates suggested Rugova's party is likely to form another coalition with its uneasy partners in the outgoing government - the Democratic Party of Kosovo of former rebel leader Hashim Thaci and the Alliance for the Future of Kosovo of ex-rebel leader Ramush Haradinaj.
Moderate turnout of about 53% of Kosovo's 1.4-million strong electorate suggested that even among the ethnic Albanian majority there was a high degree of apathy.
Unemployment is widely estimated at more than 60% of Kosovo's 1.9 million people, and most voters in the ethnic Albanian majority believe things will improve once the province becomes an independent state.
Kosovo's Serbian population
boycotted the elections
Ethnic Albanians are hoping the election provides impetus to
their demands for complete independence from Serbia and the end of the international protectorate after five years of stifling international rule.
The UN has promised a review early next year of Kosovo's progress in meeting standards of democracy and human rights, which eventually could lead to a dialogue on final status.
Ethnic Serbs and the Serbian government in Belgrade, however, insist that the territory they claim as the historic seat of Serbian culture and religion is an inalienable part of the former Yugoslav republic.
Serbian Prime Minister Vojislav Kostunica as well as the Serbian Orthodox Church backed the Serb boycott, saying that greater local autonomy is the only way to ensure security for non-Albanians.
Serbs are guaranteed 10 seats in the 120-seat parliament, but they complain they have no power to influence decision-making in the province. Those seats will now go to the two Serb parties which participated in Saturday's vote.
UN official Jessen-Petersen said
intimidation led to the boycott
Only about 1% of 150,000 eligible Serb voters cast their ballots. Instead, they demanded more autonomy over their own communities to boost security after a wave of violence by ethnic Albanian mobs, earlier this year.
More than 1000 extra Nato peacekeepers were deployed for the vote after ethnic Albanians rampaged through Serb villages in March, burning houses and churches and driving about 4000 people from their homes.
Jessen-Petersen dismissed the boycott, accusing nationalists of intimidating Serbs to stay away from polling stations. "More Serbs have decided not to vote because of the pressure," he said.
"There would have been more Serb voters if those who wanted to have a monopoly over the Kosovo Serbs had not appeared."
About 200,000 Serbs have left Kosovo since the end of the war, faced with reprisal attacks by Albanians after more than a decade of Serbian repression under former strongman Slobodan Milosevic.
Those who have remained, about 80,000, live in enclaves heavily guarded by Nato peacekeepers.