Denmark's Prime Minister Mette Frederiksen has dramatically resigned after a bruising general election — but she is still right in the thick of the fight for power.

The shock move formally kicks off coalition talks after voters delivered a political deadlock on Tuesday, with neither the left nor the right able to claim victory.

Frederiksen remains as caretaker leader for now, and despite the setback, her Social Democrats are still Denmark's biggest party. But with no side able to govern alone, the real battle is only just beginning.

The votes have been counted. The speeches have been made. Now comes the horse-trading.

Frederiksen's Social Democrats won 21.9% of the vote and 38 seats — enough to finish first, but still their worst result in more than 100 years.

That left the Danish leader with a bitter truth: she came out on top, but without the numbers she needed.

Speaking after the result, Frederiksen admitted her disappointment but tried to strike a defiant tone.

She said: "I am disappointed, of course I am disappointed, that we did not get more votes. But there is nothing today that can stop me from being proud that the Social Democrats have once again become the Danes’ clearly preferred political party."

So yes — she has resigned. But no — she is not out.

Because her party remains the biggest in parliament, Frederiksen is still one of the frontrunners to put together Denmark’s next government.

The problem? Nobody can do it alone.

Experts say the election has left Denmark with a fractured parliament and handed huge influence to the Moderates, who now sit in the all-important middle ground.

One political science professor from Aarhus University said: "We have a more fragmented parliament where none of the two traditional blocs is able to form a majority, which puts the Moderate Party in the pivotal position. They will be the kingmakers."

That is where things get messy.

The Moderates are once again holding the balance of power, meaning every major party may have to bend, bargain and backtrack to get a deal done.

The same professor added: "Bending your policies, negotiating deals, is part of Danish political culture. So in that sense that’s to be expected. It’s more difficult with these very clear statements about whom they will and will not cooperate with."

And that is the big headache now.

Parties can soften policies if they have to. What is much harder is swallowing public promises about who they would never govern with.

That could make coalition talks long, tense and unpredictable.

Even so, Frederiksen is still at the centre of the drama — because despite the election blow, there is still no obvious rival with an easier route to power.

Bernardo Basilici Menini, editor-in-chief of The Copenhagen Post, said: "What we can see now is that probably she will be the person tasked with trying to form a new government."

Denmark has voted, the numbers are in — but the real outcome is still up in the air.

Frederiksen may have resigned to get the coalition process rolling, but make no mistake: she is still very much in the game.

And now the fight moves from the campaign trail to the negotiating table.