Park Geun-hye of the governing Saenuri party is looking to make history as South Korea's first female president.

But she faces a tough challenge from Moon Jae-in of the Democratic United Party who has been steadily eroding her lead in the polls.

Whoever wins replaces President Lee Myung-bak, who is stepping down, as the law requires, after his five-year term.

The country's slowing economy, welfare and jobs creation has dominated the election campaign.

The rival candidates spent their final day of campaigning touring a number of cities in a last-ditch bid to win over undecided voters.

Park Geun-hye is the daughter of former military ruler General Park Chung-hee.

General Park is credited with transforming South Korea into an economic success story during his 1961-1979 rule, but he crushed dissent and allowed no democracy.

Both Ms Park's parents were assassinated - her mother in 1974 by a pro-North Korea gunman and her father in 1979 by his own spy chief.

Ms Park, 60, who in September apologised for human rights abuses during her father's era, said on Tuesday she would be "a president of the people's livelihoods, who thinks only about the people".

"I will restore the broken middle class and open an era in which the middle class make up 70% of the population," she said in a news conference at her party's headquarters in Seoul.

Mr Moon, a former human rights lawyer, was once jailed for protesting against General Park's regime.

He was a chief of staff to Mr Lee's predecessor, Roh Moo-hyun, who killed himself in 2009 while under investigation for corruption.

In his news conference, Mr Moon pointed to the current corruption and incompetency allegations surrounding Ms Park's own party.

"This overall crisis... will not be resolved by replacing the representative player. We must change the entire team," the 59-year-old said.

"I will become a president who wipes away the people's tears, stresses fairness and justice, makes sacrifices and dedicates himself, puts himself among the people and maintains dignity."

For all their differences, the two candidates have put forward remarkably similar policies, the BBC's Lucy Williamson in Seoul says.

They have both promised to boost social welfare spending, close the gap between the rich and poor and rein in the country's family-run giant conglomerates, known as chaebol.

On the issue of North Korea, which has not featured heavily in the campaign despite its recent rocket launch, both candidates have promised more engagement with Pyongyang - though, in Ms Park's case, more cautiously than her rival.

Our correspondent says the electorate appears to be more engaged than usual, with one recent poll suggested more than 80% of voters are planning to cast their ballots

South Korea uses a first-past-the-post system, and so the candidate with the most votes will become president.