WASHINGTON - Americans started to vote in a presidential election on Tuesday with polls showing President Barack Obama and Republican challenger Mitt Romney neck-and-neck in a race that will be decided in a handful of states.

The 10 registered voters in the small village of Dixville Notch, New Hampshire cast the first election day ballots of the US presidential election moments after midnight November 6, 2012. [Photo/Agencies]

Polling stations opened across the eastern United States and parts of the Midwest as dawn broke. At least 120 million Americans were expected to vote on giving Obama a second term or replacing him with Romney.

Their decision will set the country's course for four years on spending, taxes, healthcare and foreign policy challenges like the Iran's nuclear ambitions.

National opinion polls show Obama and Romney in a virtual dead heat, although the Democratic incumbent has a slight advantage in several vital swing states - most notably Ohio - that could give him the 270 electoral votes he needs to win.

Romney, the multimillionaire former head of a private equity fund, would be the first Mormon president and one of the wealthiest Americans to occupy the White House. Obama, the first black president, is vying to be the first Democrat to win a second term since Bill Clinton in 1996.

Fueled by record spending on negative ads, the battle between the two men was focused primarily on the lagging economic recovery and persistent high unemployment, but at times it turned personal.

As Americans headed to voting booths, campaign teams for both candidates worked feverishly at the last minute to mobilize supporters to cast their ballots.

Polls will begin to close in Indiana and Kentucky at 6 pm EST (2300 GMT) on Tuesday, with voting ending across the country over the next six hours.

The first results, by tradition, were tallied in Dixville Notch and Hart's Location, New Hampshire, shortly after midnight (0500 GMT). Obama and Romney each received five votes in Dixville Notch. In Hart's Location, Obama got 23 votes to 9 votes for Romney and two votes for Libertarian candidate Gary Johnson.

The close presidential race raises the prospect of a disputed outcome similar to the 2000 election, which was decided by the U.S. Supreme Court. Both campaigns have assembled legal teams to deal with possible voting problems, challenges or recounts.

The balance of power in the U.S. Congress will also be at stake in Senate and House of Representatives races that could impact the outcome of "fiscal cliff" negotiations on spending cuts and tax increases, which kick in at the end of the year unless a deal is reached.

Obama's Democrats are now expected to narrowly hold their Senate majority, while Romney's Republicans are favored to retain House control.

Despite the weak economy, Obama appeared in September to be cruising to a relatively easy win after a strong party convention and a series of stumbles by Romney, including a secretly recorded video showing the Republican writing off 47 percent of the electorate as government-dependent victims.

But Romney rebounded in the first debate on October 3 in Denver, where his sure-footed criticism of the president and Obama's listless response started a slow rise for Romney in polls. Obama seemed to regain his footing in recent days at the head of federal relief efforts for victims of the storm Sandy.

The presidential contest is now likely to be determined by voter turnout - specifically, what combination of Republicans, Democrats, white, minority, young, old and independent voters shows up at polling stations.

Obama and Romney raced through seven battleground states on the final day of campaigning to hammer home their final themes, urge supporters to get to the polls and woo the last remaining undecided voters.