"I am the definite winner of this presidential election," Mousavi said at a news conference in Tehran. Mousavi's supporters say the former prime minister was taking the "upper hand" and was expected to win two-thirds of the vote.
Mousavi's election would be a huge upset victory. Just weeks ago, Admadinejad was expected to cruise to reelection.
While Mousavi declared victory, Iran's state-run media declared Ahmadinejad the winner. According to Iran's state-run TV, Ahmadinejad had garnered 68.8 percent and Mousavi 28.8 percent of the 10 million votes counted thus far.
Mousavi and other candidates have alleged voting fraud and while there is no concrete data backing Mousavi's claims of a victory, the candidate and his aides made it clear that if official numbers do not show him to be victorious, they will fight them.
Official numbers are expected to be released on Saturday.
Iranians flocked to the polls to vote for their next president in an election of unprecedented interest.
Many locations extended voting hours to accommodate the throngs of people. Iran's news agency reported that more than 70 percent of Iranians who are eligible to vote participated in Friday's election.
Long lines wrapped around nearly every polling center ABC News visited, revealing a deep interest in this election, which has pitted current Ahmadinejad against popular reformist candidate Mousavi.
The month leading up to Iran's 10th presidential election was filled with a rare show of democratic energy -- heated public debates, mass demonstrations and rowdy rallies in streets around the country.
President Obama said today that he is "excited" about the "robust debate" taking place in Iran, and that it shows change is possible.
"Ultimately the election is for the Iranians to decide, but just as has been true in Lebanon, what can be true in Iran as well is that you're seeing people looking at new possibilities, and whoever ends up winning the election in Iran, the fact that there's been a robust debate hopefully will help advance our ability to engage them in new ways," Obama said.
In his speech to the Muslim world last week, the U.S. president said he wants to open dialog with Iran and move forward away from decades of animosity "on the basis of mutual respect." But he also chided the country's leadership for its nuclear weapons ambitions.
"American policy, with respect to Iran and its nuclear program, is not dependent on which administration is governing Iran," U.N. Ambassador Susan said today. "Our view is that ... the Islamic Republic of Iran ought to not pursue its nuclear program, its nuclear-weapons program, and that will not change, depending on the outcome of the election."
Rice said the United States was not endorsing any specific candidate.
"I think we were certainly heartened by the large turnout in Lebanon and what appears to be a large turnout in Iran," she said.
The draw of the election -- which the world is watching closely -- is so powerful that even some expatriates have returned to the country to cast their ballots.
Ibrahim, an Iranian-American who declined to give his full name, flew from California to Tehran to vote for a change in foreign policy.