According to results released at the elction headquarters in Abuja, the People's Democratic Party (PDP) was well ahead of its rivals after Saturday's poll with more than 50 percent support.
If the trend continues Obasanjo will be well placed ahead of the April 19 presidential elections, when he will seek re-election against a field of 19 competitors.
But the results published in the capital did not yet include many of the seats in north, where electoral officials have reported significant gains for the main opposition party.
In elections for the 360-seat lower house, the House of Representatives, the PDP was leading with 50.86 percent of the vote and 69 of the 124 constituencies so far declared.
The opposition All Nigeria's People's Party (ANPP) was trailing with 26 percent and 34 seats and the Alliance for Democracy (AD) on 18 seats and 14.49 percent.
And in the 109-seat upper house, the Senate, the PDP was also winning, taking 22 of the 33 seats so far declared and 51.34 percent of the vote.
Results issued separately by electoral officials in Kano show that the ANPP, whose presidential candidate Muhammadu Buhari is Obasanjo's main rival for power, has won 14 of 24 seats there.
The state was formerly a PDP stronghold, and the trend of the results shows a growing polarisation with Obasanjo's party losing ground in the north but making advances against the opposition AD in the southwest.
Obasanjo is a Christian Yoruba from the mainly-Christian and Yoruba southwest, while Buhari is a Hausa-speaking Muslim from the many Hausa Muslim north - Sapa-AFP
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