Japan's opposition was headed for a historic victory in an election on Sunday, exit polls showed, a win that would oust the long-ruling conservative party and give the untested Democrats the job of reviving a weak economy.

Exit polls by private broadcasters showed the Democratic Party of Japan (DPJ) could win two thirds of seats in parliament's powerful 480-member lower house.

That matched opinion polls that had forecast a huge loss for Prime Minister Taro Aso's Liberal Democratic Party (LDP). A senior LDP official acknowledged the extent of the drubbing, saying the party was headed for a 'historic defeat'.

'The predictions by the media were shocking. We had doubts, but now I think they are becoming a reality,' said Yoshihide Suga, deputy chairman of the LDP's Election Strategy Council.

A Democratic Party win would end a half-century of almost unbroken rule by the LDP and break a deadlock in parliament, ushering in a government pledging cash for consumers, a cut in wasteful spending and less power for bureaucrats.

It would unravel a three-way partnership between the LDP, big business and bureaucrats that turned Japan into an economic juggernaut after the country's defeat in World War Two. That strategy foundered when Japan's 'bubble' economy burst in the late 1980s and growth has stagnated since.

'This is about the end of the post-war political system in Japan,' said Gerry Curtis, a Japanese expert at Columbia University.

'It is the only time any party other than the LDP has won a majority in the lower house of the Diet (parliament). It marks the end of one long era, and the beginning of another one about which there is a lot of uncertainty.'    

Financial markets have sought an end to the stalemate in parliament, where the Democrats and their allies control the less powerful upper chamber and can delay bills, but bond yields may rise if a new government increases spending.

Most exit polls showed the LDP winning just over 100 seats, down from 300. Its partner, the New Komeito Party, was expected to win around 20 seats. The Democratic Party had just 115 seats in the last lower house.

'I'm happy, but at the same time I'm feeling a sense of big responsibility,' Yoshihiko Noda, the Democrats' deputy secretary- general, told TBS television.

Democratic Party leader Yukio Hatoyama, 62, the wealthy grandson of a former prime minister, spoke in sweeping terms on Saturday when he said the election would change Japanese history.

He often invoked the word change during the campaign, a theme that came up time and again in interviews with voters on Sunday. Many were prepared to give the Democrats a chance even if they were unsure the party would pull Japan out of its worst recession in 60 years.

'I don't like what's going on now in this country. Things have to change,' said Kazuya Tsuda, a 78-year-old retired doctor in Tokyo who voted for the Democratic Party.

The Democrats have pledged to refocus spending on households with child allowances and aid for farmers while taking control of policy from bureaucrats, often blamed for Japan's failure to tackle problems such as a creaking pension system.

The party wants to forge a diplomatic stance more independent of the United States and build better ties with Asia, often strained by bitter wartime memories.

'(The Democrats) are saying that they will escape from bureaucratic dominance of politics, but they must also skilfully use bureaucrats to implement their policies,' said Norihiko Narita, a professor at Surugadai University near Tokyo. 'How to cooperate with bureaucrats will be a very important point.'     Analysts worry spending plans by the Democrats, a mix of former LDP members, ex-Socialists and younger<