TEHRAN, IRAN - Conservatives were set to keep their hold on Iran's parliament, early election results showed, but the legislature may still give President Mahmoud Ahmadinejad a harder time ahead of next year's presidency poll.

Conservatives have taken 120 seats in the 290-member assembly against 46 for reformists so far, the state Press TV station has reported, citing the Interior Ministry.

In another indication of conservative dominance after many leading reformists were barred from running, conservatives were ahead for all of Tehran's 30 seats as counting progressed, state media reported on Sunday.

"The people have again given (conservatives) control of parliament," the hardline Kayhan daily said on its front-page.

The Interior Ministry, which supervised Friday's vote, has said a final nationwide tally might not come out until Monday.

Many reformists, trying to capitalize on public discontent over inflation, were disqualified from standing in the polls, but they expect Ahmadinejad to undergo sharper scrutiny even in a parliament dominated by their conservative rivals.

"The president will face more challenges with the next parliament than he did with the current one," said Mohammad Ali Abtahi, a close ally of reformist ex-President Mohammad Khatami.

Analysts said splits had opened up among conservatives -- who range from Islamic revolutionary radicals, like Ahmadinejad, to his more pragmatic critics -- and divisions could widen as they jockey for position before the 2009 presidential race.

Reformists, who seek political and social change, and some conservatives have accused Ahmadinejad of fuelling inflation, now at 19 percent, by lavishly spending Iran's windfall oil revenues on subsidies, loans and handouts.

VICTORIOUS

Conservatives, who call themselves "principlists" for their loyalty to the Islamic Republic's ideals, passed Ahmadinejad's spending plans in the outgoing parliament, which they dominated.

Pro-reform politicians have also rebuked Ahmadinejad for vitriolic speeches that have kept Iran on a collision course with the United Nations over Tehran's disputed nuclear plans.

However, Ahmadinejad has won public backing from Iran's top authority, Supreme Leader Ayatollah Ali Khamenei, who has explicitly endorsed his handling of the nuclear row.

The Interior Ministry put turnout at roughly 60 percent of the Islamic Republic's 44 million eligible voters.

The government had called for a high turnout as a show of defiance for Iran's "enemies" in the West. Reformists had also urged their supporters to dent conservative power by voting.

"The United States was the real loser and it was the Iranian people ... who emerged victorious," Foreign Ministry spokesman Mohammad Ali Hosseini told a news conference.

The United States, Iran's harshest Western critic, said the vetting process for candidates meant the outcome of voting in the world's fourth largest oil-producing country was "cooked."

The Guardian Council, a body of clerics and jurists, barred many reformists when it screened potential candidates on criteria such as commitment to Islam and the clerical system.

Washington has led international efforts to penalize Iran for failing to allay suspicions that it is seeking nuclear weapons. Tehran says its nuclear program is purely civilian. --REUTERS