The Republicans suffered multiple blows to their quest to take back control of the Senate, failing to win several hoped-for seats, as the Democrats added three to their column.
The biggest reverse came in hotly-contested Massachusetts, with television networks predicting Democrat Elizabeth Warren would oust sitting Republican Scott Brown, regaining the seat of late Democratic icon Edward Kennedy.
While eyes were focused on the race for the White House, the battle for control of the nation's two chambers of Congress was vital to chances of making any headway toward easing Washington's bitterly divided politics.
Experts are looking to see if the results will push lawmakers away from the current stalemate but despite voter disgust with a "do-nothing Congress" in the past two years there seemed little prospect of change.
Networks projected early on that Republicans would hold the House after Tuesday, as was widely expected as the Democrats had needed to win back an always improbable 25 seats to chance the balance of power.
The Republican drive for the Senate took its first setback in Maine, where former governor Angus King, an independent who is expected to side with the Democrats, was projected to succeed retiring Republican Olympia Snowe.
They also lost seats in Connecticut and Indiana, networks said.
Connecticut was particularly hard to take as Republican hopeful Linda McMahon spent big in her campaign but Democrat Christopher Murphy was forecast to win, picking up the seat of outgoing independent Senator Joe Liebermann.
Some 33 of the Senate's 100 seats were up for grabs, with 23 of those being defended by Democrats, giving Republicans a chance -- albeit slim -- of gaining four seats and seizing control of the chamber.
That effort unraveled further when Democrats were credited with picking up a Senate seat in Indiana and holding onto Missouri.
Republicans in both states, Richard Mourdock in Indiana and Todd Akin in Missouri, became embroiled in pre-election scandals over ill-judged comments about rape and abortion.
Republicans swept back control of the House of Representatives in 2010 after a backlash to President Barack Obama's signature health care reforms.
They have since used their majority in the lower House and their ability to delay legislation in the Senate to thwart the White House incumbent's plans.
With a dangerous combination of expiring tax breaks and federal spending cuts looming, the US economy could plunge over its so-called "fiscal cliff" in January and Congress will take center stage after Tuesday's votes are counted.
Republican Speaker John Boehner said retaining the House had showed US voters "made clear that there is no mandate for raising tax rates" but he pledged to work with all members in Congress to achieve a fiscal breakthrough.
"We stand ready to work with any willing partner, Democratic, Independent or otherwise who shares a commitment to getting those things done," he said.
All new legislation must be passed in identical form by both the Senate and the House before it is signed into law by the president, a fact Obama knows to his cost and which he has blamed for wrecking the second half of his term.
Much of the attention in the congressional election campaign has centered on the flagship Massachusetts, where Republican White House nominee Romney was governor between 2003 and 2007.
Projections indicated a recent surge for Warren meant the Harvard professor and liberal firebrand had overcome a sluggish start to her campaign and claimed victory against Brown.
Another state being closely watched was Virginia, neighboring the US capital, and Republicans were left hugely disappointed when George Allen failed to take the seat back and conceded victory to Democrat Tim Kaine.
The candidates had waged a vicious battle in recent months with the race centering on defense spending -- Virginia is home to the Pentagon and major defense companies -- and abortion.
Both Kaine and Allen are former governors of the state.
The fiscal cliff that will dominate discussions in Congress between now and Christmas is a major threat to the economy after a protracted but possibly reckless compromise was agreed last year between Democrats and Republicans.
If Congress doesn't agree on how to cut spending over the medium term, the current deal would force deep, immediate spending cuts on the government from January 1, while raising taxes.
Economists have predicted that the tax rises will crunch household spending, possibly tip the United States back into recession, and risk another US credit rating downgrade from international ratings agencies such as Standard & Poor's.
Regardless of whether Obama or Romney wins the White House, legislators are under pressure to come up with an alternative fiscal plan before the end of the year.
If implemented, the existing plan could cut up to four percent from gross domestic product, according to the International Monetary Fund.