The Move Forward Party (MFP) is expected to form a coalition with Pheu Thai as unofficial election results showed they were leading in a tight race.
The Election Commission (EC) began counting votes after the general election ended at 5pm on Sunday.
As of 10.30pm, Pheu Thai Party and the Move Forward Party were taking turns in leading both the constituency and party-list races.
As of 7.26am on Monday, the Move Forward Party had taken the lead in both the constituency and party-list races, followed by the Pheu Thai Party and the Bhumjaithai Party.
Earlier, Pita Limcharoenrat, the MFP leader, on Sunday confirmed that it could form a coalition government with the Pheu Thai Party and other parties from the previous opposition bloc. He confirmed he would not do a deal with the military-linked parties.
Mr Pita said MFP and Pheu Thai could have enough House seats to form a government. "This is a positive sign. It's time for Thailand to change," he said.
Asked about coalition talks with Pheu Thai, Mr Pita said he expected the talks to start at 10-11pm on Sunday night. "We will change Thailand together," the MFP leader said.
Mr Pita, 42, said the formation of the next government would be subject to a memorandum of understanding and there must be conditions.
He ruled out the possibility of forming the next government with the United Thai Nation Party of Prime Minister Prayut Chan-o-cha and the Palang Pracharath Party of Deputy Prime Minister Prawit Wongsuwon.
Mr Pita did not rule out possible coalition participation by the Bhumjaithai Party of Deputy Prime Minister and Public Health Minister Anutin Charnvirakul.
Meanwhile, Deputy Prime Minister Wissanu Krea-ngam said that the incoming government is likely to face protests and resistance from its opponents.
