It was also a torrid night for Worcester's Liberal Democrats, which suffered a massive blow in losing its Claines stronghold to leave it limping with just one councillor on the authority.
Labour kept all the seats it was defending tonight to leave it still with 16 councillors, and was left celebrating when Jabba Riaz, who defected to the party from the Tories last October, kept Cathedral by 198 votes in a fierce contest.
But a sensational Conservative victory in Claines, which saw Tory Matt Lacey beat the Liberal Democrat's Melanie Allcott by 260 votes, means the Tories have edged clear of Labour to now hold 17 seats.
The result means Labour could lose control of the council if the Tories can go into Coalition with the city's lone Green Councillor Neil Laurenson - a prospect that was being talked up this morning.
But aside from the council being hung, the other main talking point of the night was the dramatic rise of UKIP, which came second in eight of the 11 seats it contested.
Mirroring the rise of Nigel Farage's party nationwide, it came within a whisker of claiming some seats and finished runner-up in Bedwardine, Gorse Hill, Rainbow Hill, St John's, St Peter's Parish, Warndon, Warndon Parish North and Warndon Parish South - mainly taking votes from Labour.
UKIP came within 119 votes of taking the seat of the deputy leader of Worcester City Council, Labour's Geoff Williams.
Another major talking point was Battenhall, where the Conservatives held on, with Steve McKay winning with 863 votes, but the Green Party came a strong second with 751.
After the count both Conservatives and Labour claimed victory, with tense talks now set to kick off over power.
Councillor Adrian Gregson, Labour leader of the city council, said: "We are delighted we've held onto all our seats and are particularly pleased with the result in Cathedral.
"Clearly UKIP got a lot more votes than anyone expected and it's up to us to address that."
Councillor Simon Geraghty, leader of the opposition Tory group, said: "We are now the largest party with 17 councillors, and believe as we have that status we will look to form the administration.
"I'll be seeking to reach out to those other parties to have those discussions."
"I am very pleased to have gained Claines, and disappointed not to have won Cathedral."
The current Labour-led cabinet came to power one year ago after the Liberal Democrats teamed up with Green Cllr Laurenson.
The results means the Conservatives now have 17 councillors on the city council, with Labour on 16, the Lib Dems on one and the Green Party also with one.
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