Rutte's Liberal VVD would scoop up 31 seats in the new parliament making it the largest party, with Wilders and his Freedom Party (PVV) sharing second place on 19 seats with two other parties, the public broadcaster NOS said.
Millions of Dutch had flocked to the polls yesterday in a near record turnout, with stakes high in an election pitting Rutte against his far-right anti-Islam rival.
Following last year's shock Brexit referendum and Donald Trump's victory in the US, the Dutch vote is being watched as a gauge of the strength of populism on the continent ahead of key elections in France and Germany.
Wilders had pledged to close the borders to Muslim immigrants, shut mosques, ban sales of the Koran and leave the EU, if he was elected the largest party in the parliament.
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"Whatever the outcome of the election today, the genie will not go back into the bottle. And this patriotic revolution, whether today or tomorrow, will stay," Wilders said, voting earlier.
Trumpeting the country's economic growth and stability, Rutte is bidding for a third term as premier of the country -- one of the largest economies in the eurozone and a founding member of the European Union.
"This is a crucial election for The Netherlands," said Rutte, the leader of the Liberal VVD party, as he voted.
"This is a chance for a big democracy like The Netherlands to make a point... To stop this... Domino effect of the wrong sort of populism."
Queues began early at polling stations on a warm spring day and turnout reached 81 percent, just below the record of 88 percent set in 1977.
In a rare move, polling stations in Rotterdam and The Hague were allowed to stay open beyond the 2000 GMT closing time in order to allow all those in line to cast their ballots.
In The Hague's city centre where many residents are from Turkish, Moroccan or Surinamese backgrounds, a steady flow of voters -- many of them women wearing headscarfs -- came and went at polling stations.
One Muslim voter told AFP she was afraid of Wilders' fiery anti-Islam rhetoric.
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