According to latest media reports on the counting of votes, BJP has bagged 115 seats out of state's 182 , with the chief minister scoring a hat-trick. The Congress has won 61 seats while others have won 6 seats.
Modi trounced his nearest Congress rival Shweta Bhatt by a margin of 86,373 votes, while BJP also bagged Amraivadi, Mangrol and Karanj seats.
Celebrations have already begun across the state with BJP workers smearing each others face with gulal and beating drums in the streets of Ahmedabad and elsewhere.
State Congress president Arjun Modhwadia and Leader of Opposition Shaktisinh Gohil were trailing in Porbandar and Bhavnagar(rural) seats respectively, while Congress's Shankarisinh Vaghela, a former state Chief Minister and Union minister, is leading from Kapadvanj.
Keshubhai Patel, a former chief minister and Gujarat Parivartan Party president, who broke away from BJP months ahead of the elections, was leading from Visavadar.
Another Modi confidante and minister Anandiben Patel was leading in Ghatlodia. Modi's right hand man Amit Shah, an accused in the Soharabuddin Sheikh fake encounter case was ahead of his rivals in Naranpura constituency.
However, ministers in the Modi government-- Dilip Sanghani (Amreli), Jaynarayan Vyas (Siddhpur) and Fakir Vaghela (Vadgam) were trailing.
All three Congress MPs in the fray are trailing. Vitthal Radadia, MP from Porbandar, who was recently in news for brandishing a gun at a toll plaza after the attendant sought to see his identity card, was trailing from Dhoraji, Rajkot MP Kuverji Bavaila in Botad and Surendranagar MP Soma Patel in Limdi.
BJP's Gujarat unit President R C Faldu was leading from Jamnagar rural constituency. BJP rebel candidate Kanu Kalsaria, who had formed Sadbhavna Manch, was trailing.
NCP candidate Kandhal Jadeja, son of late underworld don 'Godmother' Santokben Jadeja, was leading from Kutiyana seat.
Modi seems to be on the road to sealing his status as the most high-profile leader of the BJP ahead of national polls in early 2014.
However, Modi's popularity on the national stage remains uncertain with his reputation tarnished by allegations over links to deadly Hindu-Muslim riots in his home state in 2002.
"Modi has proven that he has the ability to showcase himself as a prime ministerial candidate," Sebastian Morris, an economics professor at the Indian Institute of Management in Ahmedabad, Gujarat's main city, told AFP. "Congress will have to work hard to check his increasing clout."
Though Modi has never openly declared his ambition to be prime minister, with victory for third consecutive term, he will be increasingly seen as angling to lead the BJP into the 2014 national elections -- with the ruling Congress party weakened by slowing growth and corruption scandals.
But many in the BJP itself are wary of Modi, fearing that he remains a hate figure for Muslims and secularists following the 2002 riots. Even as it celebrated its victory in Gujarat, the Bharatiya Janata Party (BJP) was divided house on whether chief minister Narendra Modi was a prime ministerial candidate.
BJP Rajya Sabha member Smita Irani came out in his favour, saying Modi, 62, would be her candidate for the country's top post on the strength of his governance in Gujarat. Not everyone in the BJP appeared to agree -- or were as enthusiastic.
"(The Gujarat election) is not about PM candidate but about who wins in Gujarat," BJP leader Balbir Punj said. "Let us savour this moment."
Vijay Rupani, a BJP leader in Gujarat's Saurashtra region, added: "There are many able candidates in our party for the post of PM." Seshadri Chari of the Rashtriya Swayamsewak Sangh (RSS) echoed that view. "This election is not to elect a PM candidate."
In Ahmedabad, however, as news of the BJP's impending victory became known, supporters took to the streets shouting "Aaj ka CM, 2014 ka PM!"
"Big success in one state does not mean that the party is ready to put Modi centre stage," Pralay Kanungo, of the Centre for Political Studies at Jawaharlal Nehru University in Delhi, told AFP.
"The big challenge for him is to appease his party and potential allies. He will have to fine-tune his political skills to be the BJP candidate in 2014." Modi campaigned in the state polls on a platform of economic expansion and investment, gathering votes from a broad range of farmers, small businesses and young people attracted by his strong personal style, analysts said.
Meanwhile, Congress leaders today conceded defeat in Gujarat, but said it was "not open skies" for chief minister Narendra Modi, nursing national ambitions. "This Gujarat election proves that it's not open skies for Narendra Modi," external affairs minister Salman Khurshid told reporters apparently seeking to underline that the chief minister will not have an easy task ahead.
When asked why Congress is unable to defeat Modi in Gujarat, Khurshid said, "Why is Modi not able to defeat us in the country." His remarks came in the backdrop of a section of the BJP projecting Modi as the most prominent prime ministerial candidate of the party in the next Lok Sabha polls.