Heavily armed police carrying AK-47s guarded voting stations across the country as polls opened at 7 am (0100 GMT) on Thursday in what is effectively a two-horse race between Prime Minister Mahinda Rajapakse and opposition leader Ranil Wickremesinghe.
But while long queues formed in the capital Colombo, voters were slow to arrive in the island's restive eastern district of Batticaloa, where sporadic grenade explosions sounded overnight in what police said was probably feuding between rebel factions.
Left-of-centre Rajapakse wants to take a tough line with Liberation Tigers of Tamil Eelam (LTTE) rebels, rejects their demand for an ethnic homeland and vows to tighten the terms of a 2002 ceasefire.
Main opposition leader and former prime minister Wickremesinghe, who brokered the truce, is seen as more conciliatory towards minority Tamils and a safer bet to manage the $20 billion economy.
"I am voting for Mahinda (Rajapakse) because he will not divide our nation and will protect its sovereignty," said 35-year-old auto rickshaw driver Jayantha Arunasiri at a polling station on the outskirts of the capital.
The Tigers have said they do not
trust either candidate
But 40-year-old executive Nihal Perera said he had cast his ballot for Wickremesinghe. "I am voting for Ranil for peace and economic development," he said. "This government has ruined the country."
With no opinion polls the race is seen as too close to call, although Colombo's surging stock market has been betting on a Wickremesinghe victory for months.
But his chances could depend on whether Tamils in and around rebel-held areas in the north and east feel free to vote.
The Tigers have said they do not trust either candidate and their front organisations have been distributing leaflets demanding a boycott.
"All the signs are there is going to be an LTTE boycott," said one western diplomat. "If you're a Tamil you're not going to vote for fear of doing the wrong thing."
Thousands of armed police and soldiers have fanned out across the country to guard polling stations, joining more than 20,000 local and foreign election observers, mindful of a suicide bomb attack that almost killed outgoing President Chandrika Kumaratunga in 1999.
Colombo traders are betting on
a Wickremesinghe victory
Sri Lanka's two-decade old civil war, which killed over 64,000 people and displaced hundreds of thousand more, is unlikely to resume whoever wins.
But the peace process is at its lowest ebb since the ceasefire, especially after suspected rebels assassinated the country's foreign minister in August.
Wickremesinghe is generally regarded as having a better chance of saving it, but it will not be easy to tempt the rebels back to the negotiating table.
Rajapakse, who has allied himself with hardline Marxists and nationalists from the mainly Buddhist Sinhalese majority, has wide grassroots support among rural voters.
But his government has come under fire for the slow pace of reconstruction after December's tsunami despite a deluge of $3 billion in international aid, and many survivors living in wooden shacks along the battered coastline are despondent.
"We don't have electricity, we don't have food, we don't even have $50. The government has not helped us," said schoolboy Shanaka Viduranda de Silva, whose family lives in a makeshift shelter erected on the razed foundations of their former home near the southern historic port of Galle.
"If you're a Tamil you're not going to vote for fear of doing the wrong thing"
Unnamed Western diplomat
Further along the coast, hoteliers are still scrambling to rebuild guesthouses reduced to rubble along the palm-fringed, southern beaches and tourists are yet to return in their droves.
The run-up to the election has been the calmest in years, with just one murder, of a party polling agent, directly linked to the election.
Sporadic violence has continued in the east, however, between rebels and a breakaway faction thought to be backed by the military. Two dead bodies of suspected rebels were found on Wednesday while a village security guard was shot dead.
But while analysts suspect the rebels are using the truce to rebuild their forces and are in no hurry to negotiate a permanent peace deal, the truce is expected to hold.