The electoral committee said 92% of all the votes cast had been counted, leaving Basescu the winner.
"Basescu is in the first place with 51.75% of the votes, which represents 4.8 million voters," the committee spokesman, Victor Pasca-Camenita, announced on Monday.
"It was the will of the Romanian people that gave me this strong victory," Basescu, the Bucharest mayor, said at his city hall office.
His victory is set to tip the balance of power in the European Union candidate country, after parliamentary elections two weeks ago returned a hung lower house, just as Romania faces tough reforms to realise its aim to join the bloc in 2007.
Both elections revealed the poor Balkan country was split down the middle between the budding urban middle class, backing faster reforms advocated by Basescu, and the poor rural countryside rooting for Nastase's Social Democratic Party (PSD).
Voting for progress
"It's a sign that Romanians voted for progress," said Mark Percival, head of independent Romania Think Tank. "Basescu has become a symbol of progress and the fight against corruption."
Despite reviving economic growth and bringing Romania to within sight of EU membership, the PSD's image has been tarnished by scandals and the conspicuous display of wealth by some of its members turned business people.
The popular backlash against official sleaze cost the PSD and its allies in parliament their majority.