Overall, the Norwegian electorate in Monday's elections swung to the left, with a "Red-Green" alliance set to oust the ruling centre right Christian Democrats and their main Conservative allies.
But the far-right Progress Party was set to become the biggest party on the right with 37 of 169 seats in parliament, an advance of 11 since 1991.
The anti-immigration party has been compared by rivals to France's National Front and Austria's Freedom Party.
While voters deserted Prime Minister Kjell Magne Bondevik's Christian Democrats and their main Conservative allies in droves, the Progress Party succeeded with a campaign that mixed blaming immigrants for rising crime with calls for tax cuts on alcohol and Mediterranean retirement homes for Norway's elderly.
Supporters cheered and shouted as party leader Carl Hagen, a dapper, silver-haired 61-year-old, thanked voters "for making this dream come true".
"We will be the real alternative to the government," he said.
"I wasn't prepared for this," Progress supporter Irene Berg Godinez said as the results came in. "I didn't dare believe the result would be this good."
"Dangerous Africans walk the streets," read one campaign slogan, while a poster showed a masked man aiming a shotgun at the reader. "This man is of foreign origin," the caption said.
Norwegians want a bigger share
of the $190-billion oil savings
Hagen has always rejected comparisons to Jean-Marie Le Pen, the former National Front leader in France, and once refused to shake his hand, but rival politicians have said his attitude to immigrants places him on the far right of European politics.
Immigrants make up less than 6% of Norway's population of 4.5 million, which is low by European standards.
Competition for jobs is not fierce, with unemployment at under 4%, and Norway's oil revenues bankroll generous welfare benefits.
"I voted for Progress because although I think it's okay to take in immigrants, I think we have enough now," said Camila, an Oslo voter aged 23 heading to a bar to discuss the elections.
But her friend Elisabeth disagreed.
"It's bad Progress have done so well," she said. "We should be taking in more immigrants and helping them."
Norway has been ranked the best country in the world to live in by the United Nations for five years in a row.
But Hagen says ordinary Norwegians should get a bigger share of oil savings now worth $190 billion, through tax cuts and handouts.
In nearby Denmark, the anti-immigrant People's Party, an ally of the centre-right government, has pushed through laws making it harder to bring in foreign spouses or qualify for asylum.