The second-round vote will be held on January 17, with the winner succeeding Michelle Bachelet, the incumbent leftist leader, who is constitutionally barred from seeking re-election.
Pinera's victory would mark a shift to the right in a region dominated by leftist leaders but he is not expected to overhaul economic policies that have made Chile a model of stability.
Pinera promised to govern Chile with the same brand of entrepreneurial spirit that made him successful, and expressed optimism after voting on Sunday, saying that "better times are coming".
"This election pits the past against the future, stagnation against progress, division against unity," Pinera, the 60-year-old Harvard-educated businessman, told reporters on the eve of the vote.
Frei, 67, who governed Chile from 1994 to 2000, campaigned on a message of stability and experience.
"We don't want leaps into the unknown, nor do we want to return to the past. We want a government that worries about the people," he said after voting.
"We don't believe that the power of the market and money should have priority over a society."
A potentially influential wildcard factor in the second round poll will be Marco Enriquez Ominami, a former filmmaker who ran as a leftist independent candidate.
According to Sunday's incomplete count he secured about 19 per cent of the ballots.
But Ominami has so far refused to endorse any candidate for the second round pole, saying both men fronted policies that were "more from yesterday than today."
Pinera's right-wing alliance provided key support for the 1973-1990 dictatorship of General Augusto Pinochet.
But analysts say many voters are fed up with having the same government throughout almost two decades of democracy.
The leftist coalition that has run the country since Pinochet stepped down in 1990 has been credited with developing the region's highest standard of living, but it has been weakened in recent years by infighting and defections.
Many voters feel the ruling left has not done enough to redistribute Chile's wealth [EPA]
A huge wealth gap between rich and poor and a chronically underfunded education system also have many voters feeling more must be done to redistribute Chile's copper wealth.
A World Bank study several years ago showed that the poorest 10 per cent of Chileans benefit from only 1.3 per cent of government revenues, while the richest 10 per cent benefit from 40 per cent.
Lucia Newman, Al Jazeera's editor for Latin America reporting from the Chilean capital Santiago, said next month's run off was likely to be a very tight race with big spending by the two leading candidates.
Both men had already put out their new slogans for the second round of voting even before the release of the final tally in the first round.
Our correspondent said there were two arguments to what appears to be a major swing from political left to right in Chile.
"One is that it's better to let things get worse before they get better, and clean the house within the coalition parties - even if that means having to live with a conservative government for one or two political terms.
"The other is that it is a very dangerous proposition. Once you let the right-wing in, it's very hard to get them out again, and that its better to transform the coalition from within - something that hasn't really happened over the last 20 years."