Kerry came out ahead by 6 percentage points, with 40 percent of the vote. Edwards had 34 percent and Howard Dean (search) had 18 percent.
Edwards' surprisingly strong showing boosts the North Carolina senator's hope that he may have the strength to continue in the race for the nomination. At one point in early counting, the two candidates were only one vote apart. Edwards finished about 44,000 votes behind Kerry.
"This enormous surge in the last few days has been surprising everybody ... this is an amazing response," Edwards told Fox News as he continued to battle Kerry in the polls. "I'm fighting my heart out … I'm in this fight to win and I'm gonna go after it in every way I know how."
Kerry's win gives him a state primary/caucus record of 15-2 in the race for the Democratic presidential nomination.
"This is another victory for John Kerry," Tad Devine, senior adviser to Kerry's campaign, told Fox News. "We have a plan to win the nomination ... this is about winning delegates all across the country."
Devine, however, was unwilling to say that the race for the nomination is over with the Wisconsin victory.
"I think we have to go out and fight, as Senator Kerry has done, state after state, for every vote ... we've got a long way to go to win this nomination," he said.
Kerry gets a sizeable proportion of the Badger State's 72 delegates. The candidates need 2,161 delegates to win the nomination. Speaking to supporters Tuesday night, Kerry thanked Wisconsin voters for pushing him closer to his goal.
"The motto of the state of Wisconsin is 'forward' and I want to thank the people of the state of Wisconsin for moving this cause and this campaign forward tonight," he said.
Kerry may have sweated out the race in the early tallies, but the front-runner made no indication that he would change his campaign focus. During his victory speech, he continued to sharpen his rhetoric against President Bush.
The front-runner, who at one point, took out a multi-million dollar mortgage on his home to finance his campaign, railed against the wealthy and special interests in his victory speech, promising to revamp the health care system, the tax code and trade arrangements that push jobs overseas.
"We will create 500,000 new jobs by moving to energy independence ... so no young American in uniform will ever be held hostage to America's dependence on oil in the Middle East," Kerry said, adding that he will make sure that health care in the United States is a "right and not a privilege" for everyone, not just the wealthy and the powerful.
Fox News exit polls suggest that among Democrats who view beating Bush as their top priority, a whopping percentage believes Kerry has the best chance to do that.
While Kerry moves forward, Edwards too vowed to continue in that same direction, insisting that he is in the race for the long haul, even without a win in Wisconsin.
"The people of Wisconsin spoke loud and clearly today — they want this debate, they want this fight to continue," Edwards said of the voters in Tuesday's race.
Edwards said voters are focused on his race and his message of the economy, jobs and trade. A bigger turnout of independents than expected also helped his poll numbers in Wisconsin, he said.
"Obviously, this is a place [among independents], where, as an understatement, I'm stronger," Edwards said.
Dean, who has seen his momentum idle in the four weeks since the first polling in Iowa, told supporters "we are not done," though he did not indicate with what.
"I know that some of you are disappointed we didn't do as well as we hoped to do in Wisconsin, but I want you to think how far we have come," the former governor of Vermont said. "There is enormous resistance to change in the Democratic Party ... You have already started to change the Democratic Party and we will not stop. You have already written the platform for this election."
Next Move for Edwards, Dean
The strategy of focusing on key states — or cherry-picking — seems to have worked for Edwards, who is operating with a limited budget. Dean, who concentrated his efforts in the last 10 days on Wisconsin, did not have as much luck.
But not everyone thinks Edwards can continue to capitalize on his strategy.
"I think you can't run for president cherry-picking states here and there ... you have to run for president nationally," Kerry said Tuesday.
Edwards is trying to expand his approach, and is planning to challenge Kerry to head-to-head debates.
Edwards' aides are hoping for at least two opportunities to debate Kerry in the next month. They say if Dean has dropped out by then, it will be the first real debate between viable candidates in the entire campaign.
"I'm ready for that anytime tonight or tomorrow morning or anytime Senator Kerry wants to do it … I want voters to know exactly what both of us have to offer," Edwards said of a one-on-one debate.
Pundits say Edwards is definitely hitting his stride and is giving Kerry a run for his money.
"Obviously, the Kerry people would like him to drop out sooner but Edwards is running to win ... he certainly isn't running for vice president," added Fred Barnes, Weekly Standard editor and co-host of Fox News' The Beltway Boys. "He's hoping for a late surge, it's going to be hard to do but if he has a big day on March 2, it could conceivably happen."
"There are no downsides for him to stay in, he's had a great run," added National Public Radio national political correspondent Mara Liasson.
Edwards' fund-raisers said a close competitive showing in Wisconsin will enable Edwards to raise money in states where he would otherwise have been too broke to compete. Edward issued an e-mail appeal Tuesday, telling donors, "Every single contribution" counts.
Edwards now intends to target Ohio, New York and Georgia, three of the 10 states opening the polls on Super Tuesday, March 2. Aides say Edwards will start raising money as the "Kerry alternative" in New York City on Wednesday night.
Dean said that even if he didn't take Wisconsin, he wouldn't quit.
"We're moving forward and we're going to go to Super Tuesday and on beyond that. We have very strong field organizations," Dean said in an interview Tuesday. "I think there needs to be a continued debate in the party about what we're doing."
But Dean is planning an event on Thursday to announce the status of his campaign, spokesman Jay Carson said. Insiders predicted that Thursday's speech will likely mark the end of Dean's formal candidacy.
Fox News has learned that Sen. Tom Harkin, the powerful Dean-supporting Iowa Democrat, had told the doctor-turned-politician that if he suffers another loss Tuesday and doesn't bow out of the race, the senator will publicly ask Dean to do so.
However, Democratic operatives are hoping a Dean departure will be as voluntary as possible. Dean has a list of Internet e-mail addresses he used to raise $41 million in campaign funds and to boost his campaign's profile. Any animosity or humiliation would make it more difficult for the Democratic National Committee to get its hands on that list.
What Voters Want
Two in five Wisconsin voters said jobs and the economy mattered more than any other issue, according to Fox News exit polls conducted by Edison Media Research and Mitofsky International. Three-quarters of the voters said foreign trade takes jobs away from Wisconsin; the state has lost more than 74,000 manufacturing jobs, many of them of them overseas, since Bush took office.
Forty percent in 10 voters said their family is worse off financially than four years ago.
"It's time to put the money back in our country and focus a little less on fixing the world's problems," said Chris Seramur, 42, of Milwaukee, who voted for Kerry because he thought the Massachusetts senator had the best chance of taking the White House.
After the economy, voters said health care and the war in Iraq were the most important issues. Nearly half strongly disapprove of the decision to go to war against Iraq; another 20 percent somewhat disapprove.
Almost three in 10 voters said the most important candidate quality was his willingness to stand up for what he believes. One-third said they were more focused on finding someone who can beat Bush than backing a candidate who agrees with them on major issues.
One in 10 voters Tuesday considered themselves Republicans, while another one-third called themselves independents.
Fox News' Carl Cameron, Steve Brown, Ellen Uchimiya, Kelly Wright and The Associated Press contributed to this report.