The election will also bring a far-right party into Germany's parliament for the first time in more than half a century.
Mrs Merkel's conservative CDU/CSU alliance won 32.5 percent of the vote, making them the largest parliamentary group, an exit poll for broadcaster ARD indicated. However, that was down from 41.5 per cent in the last election, in 2013.
Support for the centre-left Social Democrats (SPD), currently junior partners in a so-called "grand coalition" with Mrs Merkel, slumped to 20 percent - a new post-war low. The SPD ruled out a re-run of that tie-up.
