Prime Minister Rajiv Gandhi appeared headed toward a landslide victory early today in his bid to extend the political dynasty he inherited from his assassinated mother, Indira Gandhi.

Gandhi's ruling Congress (I) Party was racing ahead of its rivals in incomplete election returns for the contested 511 seats in the Lok Sabha, or governing house of Parliament, capturing nearly eight out of 10 seats.

By 6:30 a.m. today, the Congress (I) Party had won 255 of the 320 seats decided, according to state-run television, and was leading in a wide majority of the remaining 191 districts.

The national opposition parties were virtually wiped out in every state, with the Janata Party, which ruled for 33 months after Indira Gandhi was ousted from office in 1977, winning only eight seats and the splinter Bharatiya Janata Party winning only two.

Defying the Congress wave that swept the rest of the country, the regional Telegu Desam party in the southern state of Andhra Pradesh scored a stunning victory by winning 22 of the 30 Lok Sabha seats that had been announced early this morning. The victory apparently will make the Telegu Desam, which did not exist before the 1983 state assembly election, the principal opposition party in Parliament.

More than 230 million Indian voters went to the polls in the world's largest democratic election, called by the 40-year-old prime minister 13 days after his mother was assassinated on Oct. 31 by two Sikh security guards in an apparent act of vengeance for the Indian Army's assault in June on the Golden Temple complex in Amritsar, Sikhism's holiest shrine.

If projections of voting trends hold up, Gandhi will win upward of 400 seats in Parliament, a greater majority than either his mother or his grandfather, Jawaharlal Nehru, India's first prime minister, commanded. The Congress (I) Party currently holds 355 seats, followed far behind by the Communist Party (Marxist) with 36 seats, the Peoples Party with 25, Janata with 21 and Bharatiya Janata with 16.

Jubilant Congress Party workers paraded through the streets of the capital early today, beating drums, exploding firecrackers and singing to celebrate the party's stunning victory.

Voting trends indicated that the populous Hindi-speaking belt that stretches across the northern states of Uttar Pradesh, Bihar, Madhya Pradesh, Himachal Pradesh and Rajasthan gave Gandhi's party a nearly clean sweep -- accounting for nearly 200 of the region's 225 seats.

Several major opposition leaders, including Bharatiya Janata leader Atal Behari Vajpayee and Janata leader Chandra Shekhar, were trailing far behind their opponents.

Vajpayee said last night that his defeat in the Gwalior district at the hands of ex-maharaja Madhav Rao Scindia of the former Gwalior princely state, was "in no small measure due to money power, muscle power and ministerial power." Vajpayee suffered a broken leg during an attack by political rivals in the heat of the campaign.

One of the most surprising outcomes of the election was in the northern state of Bihar, where a fractious Congress (I) state party appeared headed for upset victories in as many as 50 of the 54 parliamentary districts.

In Andhra Pradesh, where Congress (I) suffered a major setback, Home Affairs Minister P.V. Narasumha Rao was defeated by Bharatiya Janata Party candidate C. Janga Reddy in a stunning upset. But Rao, also running in Maharashtra State, won a seat in Parliament anyway.

Last August, Andhra Pradesh became a major political battleground when Indira Gandhi attempted to unseat the popularly elected Telegu Desam party government of the chief minister, N.T. Rama Rao, a former screen star. Rama Rao mounted a statewide "save democracy" campaign and won reinstatement.

But the expected backlash of the Andhra Pradesh controversy in neighboring southern Indian states did not materialize, according to today's election returns.

Gandhi's Congress (I) was leading in 25 of the 28 parliamentary districts in Karnataka State and, in alliance with the All-India Dravidian Party, appeared headed for another victory in adjacent Tamil Nadu.

In the Communist-dominated southern state of Kerala, Congress (I) made a surprise sweep, winning 11 of the 18 declared seats in a major setback for the Communist Party of India (Marxist), which had captured only one seat.

In Maharashtra State, dominated by Bombay, the Congress won 39 of the 43 seats declared, and in adjacent Rajasthan it won all 23 seats declared, with two undecided.

In the southeastern state of Orissa, Congress (I) candidates held commanding leads in 19 of the 21 parliamentary districts.

In India's other Communist-ruled state, West Bengal, Congress (I) established firm leads in five districts and slender margins in eight others. Congress now holds only four of the state's 42 seats.

Several major Congress Party figures, led by Gandhi with an overwhelming victory over his estranged sister-in-law, Maneka Gandhi, in the Emethi district of Uttar Pradesh, coasted easily to election victories. They included popular film stars Amitabh Bachchan and Sunil Dutt, and Gandhi's close confidant, Arun Nehru.

With voting limited today to only a few districts in the tiny, far northeastern states of Meghalaya and Nagaland, the violence that had marred the first two stages of the nationwide polling diminished. Fifteen persons were killed in balloting on Monday, and another eight died when voters in six states went to the polls yesterday.