The result was a further sign that the appeal of mainstream politicians in Europe -- and in the United States with Donald Trump -- is waning as populist figures tap into anger about immigration and growing inequality.
According to preliminary results, Norbert Hofer of the Freedom Party (FPÖ) came a clear first with 36 percent in Sunday's first round of an election for the largely -- but not entirely -- ceremonial post of head of state.
Candidates from the centrist parties, which have effectively run Austria since the end of World War II, failed to even make it into the runoff on May 22, languishing in fourth and fifth place with just 11 percent each.
It means that for the first time since 1945, Austria will not have a president in the Habsburg dynasty's former Vienna palace backed by Chancellor Werner Faymann's Social Democrats (SPÖ) or his centre-right coalition partners the People's Party (ÖVP).
"This is the beginning of a new political era," FPÖ leader Heinz-Christian Strache said after what constituted the best-ever result at federal level for the late Joerg Haider's party, whose 2000 entry into government sent shock waves through Europe.
The Oesterreich tabloid called it a "tsunami that has turned our political landscape upside down".
Faymann said Sunday the result was a "clear warning to the government that we have to work together more strongly". He scotched talk he would resign, however.
Facing gun enthusiast Hofer, 45 -- an engineer who often walks with a cane since a paraglider accident -- on May 22 will be Alexander van der Bellen, 72, a somewhat dishevelled but respected economics professor backed by the Greens, who won 20 percent.
The only candidate who fared worse than the main parties' candidates was Richard Lugner, an 83-year-old construction magnate and socialite married to a former Playboy model 57 years his junior, who won just over two percent.
Le Pen says 'bravo'
Congratulations poured in from other far-right leaders in Europe. Marine Le Pen, hoping to become French president next year, called it a "magnificent result. Bravo to the Austrian people".
Dutch far-right MP Geert Wilders said it was "fantastic", while Alternative for Germany head Frauke Petry hailed the "terrific outcome".
In Italy, where newspapers carried alarmed headlines, Lega Nord head Matteo Salvini expressed his "great joy". Hungary's Jobbik party cheered the government's "humiliating defeat".
Last year Austria received 90,000 asylum requests, the second highest in Europe on a per capita basis, and Faymann's government has taken a firmer line on immigration in recent months.
But this has not stopped the FPÖ surging. Polls put it in first place with more than 30 percent ahead of the next scheduled general election in 2018.
'Anger and dissatisfaction'
"Immigration was an important issue of course but this was an anti-system election," political analyst Thomas Hofer told AFP.
"For the past eight years, since the grand coalition was formed, it has been the same story of each party blocking the other... It is no wonder that anger and dissatisfaction with the system has grown while trust in democracy has fallen massively."
Support for the two main parties has been sliding for years and in the last general election in 2013 -- when, unlike now, the far-right vote was split -- they only just garnered enough support to re-form their "grand coalition".
Austria's traditionally strong economy has also faltered of late and it no longer has the lowest unemployment rate in the European Union. Faymann's coalition, in power since 2008, has struggled to agree structural reforms.
"The FPÖ is now clear favourite to emerge as the strongest party in the next general election, and can count on forming a coalition with the SPÖ or the ÖVP," Anton Pelinka, another analyst, told AFP.