The vote came six years after Puigdemont led a botched 2017 independence bidthat triggered Spain's worst political crisis in decades.
Led by Salvador Illa, Spain's health minister during the pandemic, theCatalan Socialist party won 42 of the regional parliament's 135 seats -- ninemore than in the previous election in 2021, reports BSS.
Hailing the result as "historic" in a posting on X, Sanchez said it wouldmark the start of "a new era in Catalonia".
"A new era for all Catalans, whatever they think," said Illa as hissupporters cheered his victory.
It was a major victory for Sanchez, who had wanted to show that his policy ofdefusing tensions triggered by the Catalan crisis had worked, ultimatelyreducing pro-independence sentiment in this wealthy northeastern region ofeight million people.
And it gives him some much-needed breathing space after a difficult start tohis latest term in office which began in November and has been soured byright-wing opposition and a graft probe into his wife that almost caused himto resign.
Since becoming premier in 2018 in the months following the failed separatistbid, Sanchez has sought to "heal the wounds" caused by the unprecedentedpolitical crisis
In 2021, he pardoned the separatists jailed over the secession bid and iscurrently advancing an amnesty bill for those still wanted by the justicesystem in exchange for key separatist backing that let him secure a new termin office.
- No more separatist majority -
In gaining more than 200,000 votes, the Socialists managed to deprive thepro-independence parties of the majority they needed to stay in power in aregion they have ruled for the past decade.
Final results showed Puigdemont's hardline JxCat, the moderate ERC ofoutgoing Catalan leader Pere Aragones and the smaller hard-left CUP secured59 seats, compared with 74 last time.
Even if they were to count the two seats won by the new ultranationalistCatalan Alliance, they would still be well short of the 68 seats required torule.
JxCat won 35 seats, slightly higher than last time, while ERC fell sharply to20, down 13, and CUP won just four, down from nine.
Puigdemont, 61, fled Spain to avoid prosecution following the botchedsecession bid and has lived in self-imposed exile ever since, running hiscampaign from southern France.
Although he will be allowed back when the amnesty bill becomes law, he hadhoped a strong showing in Sunday's vote would have seen him re-electedleader, paving the way for a triumphant return.
He pledged to retire from politics if he failed to win.
- Alliance building -
Despite his victory, Illa is still a long way from the 68 seats required torule and must now seek out the necessary backing to be sworn in as regionalleader.
Although the Socialists also won most votes in 2021, Illa was unable tocobble together a majority while the separatists managed to piece together a74-seat coalition.
Analysts say the most likely option would see the Socialists allying with theradical left Comuns Sumar, which won six seats, and ERC, which won 20.
Together they could count exactly 68 seats.
The vote also saw a breakthrough by the right-wing opposition Popular Partywhich won 15 seats up from three in the previous election, while the far-right Vox held onto its 11 mandates.
Both parties are vehemently opposed to the pro-independence movement and havefought tooth and nail against Sanchez's amnesty bill which will become lawwithin weeks, allowing Puigdemont to return home.
Voter Ainhoa Matos, 31, expressed hope the election would give a greatervoice to non-separatist Catalans.
"People like me who are not pro-independence have not had enough of a voiceor representation, so I hope that can change," she told AFP.