The party's two-term government suffered a devastating defeat with a swing of 12 per cent to the Country Liberal Party on a two-party preferred basis on Saturday.
Labor has governed for 19 of the past 23 years, making it the CLP's second win in two decades.
In 2016, Chief Minister-elect Lia Finocchiaro was one of two CLP survivors after a crushing defeat left Labor with 18 of 25 seats in the wake of an ABC exposé about the inhumane treatment of children in Territory Detention Centres.
At the time Prime Minister Malcolm Turnbull instigated the Royal Commission into the Protection and Detention of Children, which handed down 227 recommendations.
However, just two terms later, Ms Finocchiaro has won the vote with a campaign that largely ignored the same recommendations that lost her party power eight years ago.
Lia Finocchiaro's Country Liberals are looking to take 15 or 16 seats of the 25-seat parliament. ((A)manda Parkinson/AAP PHOTOS)
She has promised to lower the criminal-age of responsibility to 10, reinstate spit hoods on children in all settings and introduce Declan's Law, which will mean "violent offenders" are automatically remanded to jail with a presumption against bail.
She has also vowed to return responsibility for youth detention to the Department of Corrections and increase police powers to arrest young people.
The CLP will also recycle plans to use truancy officers, an NT intervention policy that punished largely Aboriginal families when their child did not attend school.
Introduced by federal Labor in 2009, the School Enrolment and Attendance Measure project was later scrapped by CLP Indigenous affairs minister Nigel Scullion who labelled it a "complete failure".
The CLP ran a campaign of largely unknown Territory candidates who kept a low profile during the election.
Instead, the party hedged its bets on Ms Finocchiaro, who picked up not only 49.5 per cent of the overall primary vote but more than 80 per cent of votes in her own electorate.
On her first day in the top job, she met privately with Police Commissioner Michael Murphy and the Department of Chief Minister and Cabinet chief executive Ken Davies.
Despite the overwhelming CLP victory, voter turnout was only about 65 per cent, with some electorates as low as 32 per cent.
Ms Finocchiaro met with top cop Michael Murphy and Department of Chief Minister CEO Ken Davies. (Liam Mendes/AAP PHOTOS)
While the swing to the right was enough to deliver the win, the swing in urban seats towards independents and Greens also created history.
Fannie Bay candidate Suki Dorras-Walker is expected to claim the Green's first ever Territory seat after defeating former police minister Brent Potter, while independent candidate Justine Davies has won the neighbouring seat of Johnston.
Environment Center NT chief executive Dr Kirsty Howey said on Saturday evening mass land clearing, fracking and Darwin's proposed $1.5 billion Middle Arm development had produced the first Green and progressive Independent in the NT.
"Labor's progressive vote has collapsed in the NT election. They've bled to the right and the left," she said.
Liberal Party federal deputy Sussan Ley said Labor had failed to measure the impact of cost-of-living upon Territorians.
"Cost-of-living counts incredibly for these communities," she told the ABC.
" And so does development and resources in promoting jobs and opportunity for the next generation."
Labor will have to replace Eva Lawler as leader after she lost her seat of Drysdale. ((A)manda Parkinson/AAP PHOTOS)
Labor will now turn its mind to finding a new leader, however it may only retain four seats, one of which will be that of previously ousted former chief minister Natasha Fyles.
Immediate outgoing party leader Eva Lawler said it had been an privilege to lead the Northern Territory.
"Every day I drove into work I would pinch myself and say this is an honour," she said.
"I would have liked longer but it is now up to Labor ... in opposition."
The CLP is looking to take 15 or 16 seats of the 25-seat parliament, with at least two independents and the potential for the Greens to pick up their first seat.
Labor could have as few as four seats.
17°C