The moderate Basque Nationalist Party came top in the Sunday elections in one of Spain’s 17 autonomous regions, winning 27 seats in the 75-member regional parliament.
The left-wing separatist EH Bildu coalition, which campaigns for an independent country within the European Union, won 21 seats. The two parties jointly took almost two-thirds of the parliament seats and brought an end to the rule of the socialist government that took office three years ago.
The prosperous Basque region, which is home to 2.2 million people, has been racked by decades of separatist violence.
The poll results are expected to lead to more anti-government sentiments, which has been under fire over its austerity measures and public spending cuts and tax hikes.
Public protests have grown in Spain over the speculation that the government will seek a Greek-style European bailout to keep its borrowing costs in check.
Over the past few months, anti-austerity demonstrations have turned violent in Spanish cities such as Madrid, Barcelona and Valencia, as well as in rural mining locations in the north.
Battered by the global financial downturn, the Spanish economy collapsed into recession in the second half of 2008.