If Ms Livni succeeds in forming a new government, she will follow in the footsteps of Golda Meir, who served as Israel's leader for five years, which included the 1973 Yom Kippur War.
During the polling, Ms Livni was not so certain of her victory and repeatedly called on Kadima members to vote. By evening, with only a 30 percent turnout, the party's election committee accepted a request by Ms Lvini's campaign to postpone the closing of the election booths by half an hour.
Ms Livni's attention will now need to turn to the formation of a coalition after Prime Minister Ehud Olmert officially submits his resignation to President Shimon Peres, as he pledged he would following the primaries.
Mr Olmert has yet to announce exactly when he plans to resign, but officials close to him said that it may only happen at the beginning of October, after Rosh Hashanah.
According to the exit polls, only about 50 per cent of Kadima's 74,000 registered party members voted in the primaries.
Ms Livni is expected to encounter major difficulties in forming a new coalition, with her main opposition likely to come from the strictly Orthodox Shas Party, which is against the current negotiations with the Palestinians.
Defence Minister Ehud Barak - Labour Party leader and a member of the ruling coalition - may also refuse to join a new Kadima-led government out of fear that Ms Livni as prime minister will steal the Labour Party's base support of secular, middle-class, left-leaning voters.
If Ms Livni fails to put together a new coalition, Israel will go to elections in early 2009, and Mr Olmert will remain as a caretaker leader until then.
Mr Olmert voted at a Jerusalem polling station on Wednesday and seemed to play down his earlier pledge to resign. "Goodbye," he said on his way out of the voting booth. "We will still see you again."
Voting in Tel Aviv, an unusually smiling Ms Livni declared that only she was capable of restoring the public's faith in the political system.
"If you are fed up with yesterday's politics, then bring about change by voting for what you believe in," Ms Livni said. "Come and vote, bring your children, and show them how you are changing the country."
Throughout the race, Mr Mofaz had emphasised his experience as a former defence minister and IDF chief of staff.
"The state of Israel is facing major challenges over the coming years and needs a strong leader who has the courage to make decisions and the ability to take action," he said.
