Mr Howard, voting in his own Sydney seat of Bennelong which he has held for 33 years, acknowledged that he was in a tight race against Labor's star candidate, former television presenter Maxine McKew.
“Bennelong is a marginal seat but I have always treated it with great care and affection, and I hope the people return me,” said the conservative leader, who has been in power for more than 11 years.
If Mr Howard does lose his seat he will be the first prime minister in 78 years to suffer the indignity of being thrown out in his own constituency.
Mr Howard has been trailing in the opinion polls both nationally and in his own seat, but said he believed there had been a shift in support towards his government in the past week.
“We'll know tonight how accurate the feeling is,” he told reporters.
Some of his fellow voters at the Ermington West Public School wished the prime minister well, while others suggested he prepare for retirement.
Labor leader Mr Rudd cast his vote at St John the Baptist Church polling booth in his neighbourhood of Bulimba in the Queensland state capital Brisbane north of Sydney.
“It's a tight and tough race,” he told reporters. “I think we are going to do a more than competitive show.”
Opinion polls have long suggested a landslide for Mr Rudd's centre-left party but two last minute surveys showed Mr Howard significantly narrowing Mr Rudd's lead.
‘Home’ seats important
Both Mr Howard and Mr Rudd believe voters in their own electorates will today reflect the broader picture of which direction Australia wants to go.
Mr Howard said voting in his north-western Sydney seat of Bennelong will mirror the situation across the country.
“I think the election in Bennelong will be close because it is a marginal seat,” Mr Howard told Sky News today.
“If the nation comes back to the coalition then that will be reflected in Bennelong.
PM, Rudd both confident
“I am quietly confident,” he said.
Mr Rudd in Brisbane told Sky News he was likewise confident of victory.
“Here in Queensland it's really crucial in terms of how we go in my own state.
“There is a strong mood for change in Australia, people wanting new leadership with a positive plan for the future,” he said.
Actors David Wenham and Rhys Muldoon have come out in support of Howard’s opponent Maxine McKew, handing out how-to-vote cards for Labor's high profile candidate at Epping West Public School.
The former ABC journalist needs a swing of more than four per cent to make Howard the first prime minister since Stanley Bruce in 1929 to lose his own seat.