The centrist Liberals, led by Justin Trudeau, started the campaign in
third place but in a stunning turnaround now command a majority.
Mr Trudeau, the 43-year-old son of late Prime Minister Pierre Trudeau, said Canadians had voted for real change.
Incumbent Conservative PM Stephen Harper - in power since 2006 - has congratulated his rival.
Justin Trudeau is son of late Prime Minister Pierre Trudeau, considered the father of modern Canada.
Trudeau's to-do list
Addressing jubilant supporters, Mr Trudeau said Canadians had "sent a clear message tonight: It's time for a change".
"We
beat fear with hope, we beat cynicism with hard work. Most of all we
defeated the idea that Canadians should be satisfied with less.
"This is what positive politics can do," he said, also praising Mr Harper for his service to the country.
During the 11-week election campaign, the Liberal Party said it would:
- Cut income taxes for middle-class Canadians while increasing them for the wealthy
- Run deficits for three years to pay for infrastructure spending
- Do more to address environmental concerns over the controversial Keystone oil pipeline
- Take in more Syrian refugees, and pull out of bombing raids against Islamic State while bolstering training for Iraqi forces
- Legalise marijuana
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