Serbian Socialist leader Ivica Dacic has been given the mandate from President Tomislav Nikolic to form a coalition government with Nikolic's nationalist Progressive party.
The potential nationalist-socialist coalition would mark the return to power of the Socialists and their nationalist allies for the first time since the late autocratic ruler Slobodan Milosevic, who led the Socialists, was ousted in a popular revolt in 2000.
Dacic was a Milosevic spokesman during the Balkan wars of the 1990s.
Serbia held inconclusive parliamentary elections in May, with Nikolic's Progressive party and the pro-European Union Democratic party of former President Boris Tadic winning the most votes, but not enough for either party to govern alone.
Dacic, whose Socialists finished third, initially agreed to form a coalition with the Democrats, but turned to the Progressives after Tadic was defeated by Nikolic in the May presidential election.
Nikolic said after meeting Dacic on June 28 that the Progressive party, the socialists and a small center-right party have agreed to form a coalition. If he succeeds in forming a government, Dacic will be prime minister.
Nikolic said the new government "must stay on a stable European course."
Analysts say a nationalist-socialist government could raise concerns about Serbia's committment to pursue its proclaimed EU membership bid and mend relations with its Balkans neighbors.
Nikolic asserts that he has shifted from a staunchly anti-Western, pro-Russian stance to a pro-European Union position. But in the short time since he was elected in May, he has made some controversial comments about the Balkans wars in the 1990s that have angered Serbia's neighbors.
Dacic was given the mandate to form a government exactly 11 years after Milosevic, accused of helping trigger the Balkan conflicts, was extradited to the United Natinos war crimes tribunal by Serbia's then ruling Democrats.
Milosevic died in 2006 during his war crimes trial at the tribunal in The Hague.
Based on reporting by Reuters, AFP, and B92