The Shiv Sena finished on top of a hung BrihanMumbai Municipal Corporation (BMC) on Thursday but the BJP said it could take control of India's richest civic body with the backing of independents.
Shiv Sena activists celebrated earlier in the day as it appeared it was set to take control of the BMC but it finished with just 84 of the 227 seats.
The BJP came close with 81 seats.
Any party or combine will need 114 corporators for a simple majority.
Across Maharashtra, however, the Bharatiya Janata Party made major gains in elections held for municipal bodies.
The Shiv Sena victory came in Thane.
BJP Mumbai President Ashish Shelar said the party had bagged 81 seats in Mumbai and had the support of four independents and that it was in a position to claim the crucial post of Mayor.
"This is a historic victory for the BJP. . .
We are only three seats less than the Shiv Sena. . .
The credit goes to the development agenda of Prime Minister Narendra Modi and Chief Minister Devendra Fadnavis, " he said.
An aggressive Shiv Sena had snapped ties with the BJP ahead of the municipal elections and its leader Uddhav Thackeray had expected the Sena to win at least 100 seats, if not an outright majority.
The BMC, which is also the country's largest municipal body, had an annual budget of Rs 37, 000 crore in 2016 - 17.
The Congress trailed at a distant third in Mumbai, forcing its city unit chief Sanjay Nirupam to accept moral responsibility.
He told IANS that he was ready to resign from the post.
The Maharashtra Navnirman Sena (MNS) of Raj Thackeray, Uddhav's estranged cousin, finished with seven seats.
The Nationalist Congress Party (NCP) bagged nine seats and the Hyderabad - based Majlis - e - Ittehadul Muslimeen three.
The BJP's solid gains came in other major cities of Maharashtra.
The BJP raced towards victory in the Pune Municipal Corporation, pushing the ruling NCP to a poor second spot.
The Shiv Sena, MNS and Congress fared poorly in the state's cultural and IT capital.
The contest was close in Pimpri - Chinchwad Municipal Corporation near Pune, with the ruling NCP leading in 27 seats and the BJP at the second place with 21 seats.
The Shiv Sena was on way to retaining control over the 131 - seat Thane Municipal Corporation.
Nagpur appeared to be going the BJP way, with the party leading in 70 of the civic body's 151 seats, the Congress in 20 and the NCP and Shiv Sena in one seat each.
In Nashik, the BJP appeared set to bag the 112 - member civic body.
The BJP was faring well in Amravati too, Election Commission officials said.