Nepal politics: Parliament Speaker Dev Raj Ghimire said Dahal won 157 votes against the 138 required in the 275-member parliament, while 110 lawmakers voted against him.
With the conclusion of the vote counting results from the recent elections, major parties have further intensified negotiations to form the new government.
The Nepali Congress led by PM Deuba has won 53 seats in the general election. Meanwhile, Communist Party of Nepal (Unified Marxist Leninist) (CPN-UML) won 42 seats.
Nepali Congress has won 39 seats under the direct voting system. Its alliance partners CPN-Maoist Centre and CPN-Unified Socialist have won 12 and 10 seats respectively.
PM Deuba secured 25,534 votes against his nearest rival Sagar Dhakal, 31, an independent candidate who received 1,302 votes. Deuba has never lost any parliamentary election in the five decades of his political career.