Support for her conservative CDU/CSU alliance has dwindled but the bloc will remain the largest in the parliament.
Its current coalition partner, the social democratic SPD, says it will go into opposition following big losses.
The nationalist AfD is on track to become the third party.
The performance, better than forecast in opinion polls, means the right-wing, anti-Islam party will have seats in the Bundestag for the first time.
Dozens of protesters have gathered outside the party's headquarters in Berlin, some with placards saying "Refugees are welcome". ...