Labour is set to be able to govern alone with 64 MPs.
Labour is sitting on 49 per cent with National on a distant 27 per cent.
That will be the first time since the MMP voting system was introduced in 1996 that a single party has been able to form a majority alone.
Big National names including Nick Smith and Gerry Brownlee have lost their electorates.
The Greens and Act are both set to have 10 MPs as it stands. NZ First are out of Parliament with just 2.6% of the vote.
Labour leader Jacinda Ardern said the result gave her party the mandate to accelerate the recovery process following the Covid-19 pandemic.
National leader Judith Collins conceded defeat and congratulated Ardern on her victory.
Former National leader Simon Bridges told 1 NEWS earlier in the night the results looked to be a “massive majority for Labour”.
"It’s grim. I can’t think of a worse night except for possibly 2002 - but look, it’s grim.
"What I see on the numbers is a massive majority for Labour with unfettered power to do what they want," Bridges said of the result so far.
A National Party member has called the election "a catastrophe", while TVNZ presenter Hilary Barry agreed, saying the party is having a "horrific night".
The Green Party is set to bring in 10 MPs, as will ACT.
Voting booths closed at 7pm today. However, almost two million people cast their vote before election day, accounting for about 57 per cent of registered voters. In 2017, 2.6 million people voted, with 1.2 million voting early.
The advance votes were counted from 9am.
Ballots cast on election day are counted from 7pm and results released by the Electoral Commission as they come in.
Only the party and electorate votes were counted today, not the referendum ballots. Instead, the preliminary referendum results will be released by the Electoral Commission on Friday, October 30.