Anthony Albanese will be able to form majority government after claiming victory in a 76th seat.
Labor has managed to retain the Melbourne seat of Macnamara, holding off the Greens.
It is still a chance of winning a 77th seat, with two seats still to be decided.
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Labor holds a lead of just 142 votes in the seat of Gilmore on the New South Wales south coast where former NSW minister Andrew Constance was contesting for the Liberal Party.
The party has narrowed the gap in the Melbourne seat of Deakin, held by former assistant Treasurer Michael Sukkar, but still trails by 619 votes.
Labor MPs will meet in Canberra today for the first time since the election victory.
The Prime Minister will later unveil the rest of his new-look cabinet with the full ministry to be sworn in on Wednesday.