Although most see her as an outdated throwback to colonial days, Australians decided in a landmark referendum today to keep Britain's Queen Elizabeth II as their head of state.

The result was a major victory for Prime Minister John Howard and other monarchists, who claimed a victory for stable government.

"Today is a very, very special day in the history of our great country," Kerry Jones, who led the monarchist campaign, told cheering supporters at a victory party. "The Australian people have had their say, and they said 'no' to dumping the queen."

Voters were asked if they wanted to change the 98-year-old constitution to establish Australia as a republic and replace the queen as head of state with a president appointed by Parliament.

With almost 80 percent of ballots counted, 55 percent of the voters cast votes against the republic, compared with 45 percent in favor.

Those who had hoped the vote would establish Australia as the world's 147th republic vowed not to give up the fight. They said it was the proposed republic model that voters rejected and noted that opinion polls indicate Australians favor a republic in general. The referendum proposed that the president be appointed by a two-thirds majority of legislators. Polls indicate that people favor a direct election.

"It's a great pity and very disappointing," said Ted Smout, 101, after voting for the republican plan at a polling booth near his home in Sandgate in Queensland state. Smout said he would probably not be around to see it, but "Australia will become a republic, it's just a matter of time. It's evolution."

Billy Porter, a 22-year-old electrician, voted to keep the queen. "I'm not a hard-core monarchist," he said.

"The reason I'm voting 'no' is because we already have a good system, and for financial reasons. It will cost millions to change."

Settled as a British colony in 1788, Australia has been an independent nation since its six states federated in 1901. But like many Commonwealth countries such as Canada and New Zealand, it still recognizes the British monarch as its head of state.

By rejecting the referendum, Australia will remain one of 64 nations with a monarch as head of state.

After the vote, Elizabeth, who with her husband Prince Phillip is scheduled to visit Australia in March, issued a statement from Buckingham Palace in London.

"I respect and accept this result," she said.

"I have always made it clear that the future of the monarchy in Australia is an issue for the Australian people and them alone to decide, by democratic and constitutional means."

CAPTION: James Darby, a monarchist, waves the Australian flag to celebrate his side's victory over pro-republic forces.