By Francois Murphy and Dave Graham

VIENNA (Reuters) - Austrians were voting on Sunday to elect a new parliament, with the far-right Freedom Party (FPO) aiming to secure its first general election win in a close race with the ruling conservatives.

The campaign was dominated by voter concerns over economic worries and immigration. The FPO led opinion polls for months but its edge over the ruling Austrian People's Party (OVP) has shrunk to almost nothing as Chancellor Karl Nehammer casts himself as a statesman and depicts his rival, FPO leader Herbert Kickl, as a toxic menace.

Whoever wins will fall short of an absolute majority, polls show, but will claim the right to lead a coalition government.

The first polling stations opened at or shortly before 7 a.m. (0500 GMT). Projections are due minutes after polls close at 5 p.m., with results being finessed over the ensuing hours.

"What's at stake is whether the FPO will appoint the chancellor or not," Kathrin Stainer-Haemmerle, political science professor at the Carinthia University of Applied Sciences.

"Should that happen, then I have to say the role of Austria in the European Union would be significantly different. Kickl has often said that (Hungarian Prime Minister) Viktor Orban is a role model for him and he will stand by him."

An FPO victory would make Austria the latest European Union country to register surging far-right support after gains in countries including the Netherlands, France and Germany.

The Eurosceptic, Russia-friendly FPO, which is critical of Islam and pledges tougher rules on asylum seekers, won a national vote for the first time in June when it beat the OVP by less than a percentage point in European elections.

The OVP, which like the FPO backs tougher immigration rules and tax cuts, is the only party open to forming a coalition with the far-right party. However Nehammer says his party will not join a government with Kickl in it.

Sarah Wolf, a 22-year-old graphic designer and Austrian Communist Party supporter in Vienna, said tactical voting was worth considering to keep the FPO out.

"What most scares me if the FPO really does get the most votes is we get something like Viktor Orban: a slow, gradual reduction in media diversity, democracy and understanding," she said. "There are just so many really dangerous signs."

'FORTRESS AUSTRIA'

Kickl, 55, has thrived as an opposition firebrand but has at times appeared uncomfortable trying to moderate his tone to widen his leadership appeal.

Viktor de Lijzer, a 17-year-old soldier who supports the FPO, said the party was best placed to fix what he saw as too much criminal violence spurred by immigration.

President Alexander Van der Bellen, who oversees the formation of governments, has voiced reservations about the FPO because of its criticism of the EU and its failure to condemn Russia's invasion of Ukraine. The party opposes EU sanctions on Moscow, citing Austria's neutrality.

He has hinted he might thwart Kickl, noting the constitution does not require him to ask the first-placed party to form a government, even though that has long been the convention.

The FPO wants to stop granting asylum altogether and build a "fortress Austria" preventing migrants from entering, even though that would be widely viewed as illegal or impractical.

Nehammer has depicted Kickl as a conspiracy theorist shouting from the sidelines while he runs Austria.

The 51-year-old Nehammer has since 2021 led a coalition with the left-wing Greens, but the alliance has proved fractious with the economy struggling and inflation worrying voters.

Some voters think Nehammer's handling of severe flooding in Austria this month probably saw him claw back support.

Susanne Pinter, 55, a Greens supporter in Vienna, said the floods had helped Nehammer look statesmanlike but she still feared a far-right victory.

"If the FPO wins," she said, "it'll have bad consequences for women, people of migrant origin and climate change."

(Reporting by Francois Murphy and Dave Graham; Additional reporting by Louis van Boxel-Woolf; Editing by Helen Popper and Frances Kerry)