Final results of Israel's parliamentary election confirmed on Thursday that the centrist party of Foreign Minister Tzipi Livni won the contest by a single seat over right-winger Benjamin Netanyahu's Likud.

The end count did nothing to change the confusing political picture that emerged on Tuesday night, or resolve a potentially paralyzing dispute between the two main parties over who should rightfully head the next government.

Former premier Netanyahu was unlikely to drop the claim he has made since Tuesday's vote that he, not Livni, should be given the first chance to form a coalition government, because parliament has a broad right-wing majority that would back him.

More than 150,000 ballots from military bases, prisons and Israeli diplomatic missions still had to be counted after the bulk of civilian votes in Tuesday's national poll delivered Livni's slim majority over Netanyahu's Likud.

In the end, the Israel Elections Committee confirmed that Livni's Kadima party took 28 seats in the 120-seat Knesset, while Likud secured 27 seats, dashing Netanyahu's hopes that the final count could swing the result his way.

But the lineup of smaller parties was also largely unchanged, and here the numbers were in his favor.

Avigdor Lieberman's far-right Yisrael Beiteinu (Our Home is Israel) won 15 seats and the ultra-Orthodox Shas party has 11 seats, while left-wing Labour took just 13. Netanyahu says this gives him a better chance of forming a coalition than Livni.

Attention is now on President Shimon Peres, who has nearly two weeks to decide which parliamentarian to ask to form a government. By tradition, it has been the leader of the biggest party in parliament. But the results showed parties to the right of Kadima have 65 seats compared to 55 for Kadima and the left.

BREAK WITH TRADITION

Lieberman surged to third place in the ballot, past the once dominant Labour party, with a call for Israeli Arabs to undergo loyalty tests. He has emerged as potential kingmaker.

"I know exactly what I am going to tell the president," he said on Israel Radio, without elaborating. He held talks with both Netanyahu and Livni on Wednesday.

Netanyahu held coalition talks on Thursday with the right-wing National Union, which won four seats, and Israeli media said it seemed Peres would have no choice but to pick the Likud leader if the various rightists all backed him.

But it would be the first time in Israel's 60-year history that the winner of an election had been passed over.

The election results become fully official on February 18, when they are published in the government gazette. Peres would then have a week to make his nomination, and the candidate he chooses, 42 days to attempt to form a government.

Netanyahu had been cruising ahead in opinion polls until Prime Minister Ehud Olmert's government launched a military offensive against Hamas Islamists in the Gaza Strip to stop them firing rockets at towns in southern Israel.

The 22-day January war, which cost 1,300 Palestinian lives versus 13 Israelis killed, had massive Israeli public support. After a January 18 ceasefire, the election campaign resumed as Israel pursued Egyptian-brokered talks with Hamas on a durable Gaza truce.

Livni led the main peace talks last year with the Palestinian Authority of President Mahmoud Abbas, and would try to revive them. Netanyahu is cooler on the key trade-offs for an accord -- ceding occupied land and curbing Jewish settlement.

Lieberman and religious parties in a coalition would be likely to set virtually impossible conditions for a peace deal.

The Palestinian Authority, which governs the occupied West Bank, said whoever ended up in charge of Israel would be obliged to continue talks and to meet international obligations.

(Additional reporting by Allyn Fisher-Ilan, Joseph Nasr and Alastair Macdonald; editing by Alastair Macdonald)