Robert Abela will serve as Malta’s next prime minister after beating Chris Fearne to be elected Labour Party leader early on Sunday.

Dr Abela soundly beat his more favoured rival, securing 57.9 per cent of the vote, in what is likely to go down as one of the biggest upsets in contemporary political history.

He replaces Joseph Muscat, who was forced to resign after the investigation into the murder of journalist Daphne Caruana Galizia implicated his top aide.

In his first remarks following the victory, Dr Abela paid tribute to his rival.

"I am humbled," he said as his wife, Lydia, stood next to him.

"I thank my friend Chris [Fearne] and look forward to working together for the good of the party and country. There is only one winner today - the Labour Party."

Dr Abela will give his first official speech as Labour leader at 4pm on Sunday afternoon at the Corradino Sports Complex in Paola, at the closing event of a Labour Party congress.

He is expected to take his oath of office as prime minister next week. Outgoing prime minister Joseph Muscat said he will be "proud to be handing over" the office of prime minister to him "on Monday".

More than 92 per cent of the 17,500 eligible Labour Party members cast their vote in polling stations set up inside party clubs across the country.

Dr Abela obtained 9,342 votes while Mr Fearne got 6,798.

The victor was the self-professed underdog in the two-man race but made rapid inroads into Mr Fearne’s seemingly unassailable lead in the last 10 days of the campaign.

Whispers that he might have pipped his rival to the post began to circulate soon after the vote reconciliation process began. Those rumours only gained strength as the night progressed.

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After the results of the first box of votes revealed a roughly 66-33 split in favour of Dr Abela, his supporters at the Labour Party’s makeshift counting hall in Hamrun burst into cheers and cries of “Robert, Robert”.

That margin narrowed as vote counting progressed, but Dr Abela's lead was never in doubt. The cries grew louder and Labour MPs began offering him their congratulations on social media.

Clint Camilleri was the first to do so, writing that Dr Abela's victory filled the party with "energy and courage".

Others quickly followed suit, and shortly before 1am party deputy leader Chris Cardona said that Dr Abela had clinched it.

"Congratulations Robert Abela, prime minister and Labour Party leader," Dr Cardona wrote.

"Now let us work together to ensure the country continues to move forward".