She will face the electorate again on June 22, along with Congressman Gresham Barrett, who got the second highest number of votes.
A candidate must get 50 percent plus one vote to secure the party nomination. The two other contenders, state attorney general Henry McMaster and Lt Gov Andre Bauer, were out of the race winning the third and fourth place.
The winner of the run off will face State Senator Vincent Sheheen, who won the Democratic nomination with a comfortable majority.
Haley got 184,014 votes when 377,547 votes were counted in the 40 of the 46 counties (48.74 percent).
Congressman Gresham Barrett came second with 85,137 votes (22.55 percent.) State Attorney General Henry McMaster received 63,064, 916.70 percent) while state's Lt Governor Andre Bauer got 45,332 (12.01 percent).
"We knew from the beginning it was us vs. the establishment. We were settling for a Republican House, a Republican Senate, a Republican governor. I won't stop until we get a conservative House, a conservative Senate, a conservative governor," Haley said.
Haley, 37, elected to the state assembly in 2004, survived two accusations of infidelity and racist taunts by state Senator Jake Knotts to reach the run off.
Most people believe that it is only a matter of few days before Haley snatches the Republican nomination.
An underdog till the last days of the election, she surged forward after the endorsement of former vice presidential candidate Sarah Palin.
The winner in the Republican Primary is expected to win in the November general election too as the state is predominantly conservative. If she wins then, she would be the second Indian American to reach the post of governor after Bobby Jindal of Louisiana.
"Nikki Haley is poised to become the next Governor of the great state of South Carolina, and we are going to be there every step of the way with her," said Indian American Conservative Council Chairman Dino Teppara.
"Many of our members worked incredibly hard to support Governor Bobby Jindal, a poised and focused government reformer in both 2003 and 2007.
"It is amazing to see an intelligent brown-skinned lady thriving in the Deep South...especially under the conservative banner," Guru Roop Khalsa, a white American Sikh from Arizona, commented about the rise of Nikki Haley.
"I believe state Senator Knotts' comments helped her. She is very close to Asian American Community," South Carolina regional director of Asian American Hotel Owners Association, said.
"AAHOA also endorsed her and contributed to her campaign fund. Indian community too worked very hard, encouraged voters to go out and use their right to elect the best one, who is Nikkei Haley. Hoteliers provided their facilities for campaign calls," he said.
The Tea Party movement, which is spearheading an ultra right wing campaign, also favoured Haley.
But to the chagrin of many, a political blogger, Will Folks, who helped her in her public relations work for some time, claimed that he had an inappropriate physical relation with Haley, married with two children.
Though he initially said that he would not reveal more, he later said it happened in 2007, before his marriage.
Haley vigorously denied it and said she has been 100 percent faithful to her husband of 13 years, Michael Haley, an army reserve officer. Folks then published telephone records which showed that Haley called him several times in 2007.
Since he did some work for her, not many found it credible.
But soon Larry Marchant, a political consultant of Lt Gov Andre Bauer, came forward to claim that he had a one night physical relation with her in 2008. He said he had no evidence to prove it.
Haley denied that too. Folks, Marchant and Bauer have had business relationships, which also weakened the claims.
After these allegations, the whole state seemed to focus on Haley and the other candidates went out of the limelight.
Haley has suffered no political damage from unproven accusations, Public Policy Polling found. Haley's favourability rating among voters had increased since the previous poll. According to the poll, 54 percent did not believe the accusers. One-third said they were not sure, and 13 said they thought the accusations were true.
Haley has said she would resign if proof of infidelity emerges, and 42 percent surveyed agreed she should drop out of the race.
Then came state Senator Jake Knotts comment, "We've already got a rag-head in the White House; we don't need another rag-head in the governor's mansion."
It was accused as racist and especially demeaning to Haley who comes from a Sikh family. Knotts later apologised and Haley said she is Christian and goes to the Methodist church with her husband and two children, Nalin and Rena.
"My faith in Christ has a profound impact on my daily life and I look to Him for guidance with every decision I make. God has blessed my family in so many ways and my faith in the Lord gives me great strength on a daily basis. Being a Christian is not about words, but about living for Christ every day," she wrote on her website.
South Carolina, a former slave state, and one of the most conservative states in the US is heavily populated with extremely conservative, right-wing, Christian evangelical and fundamentalist voters.
"I personally would much rather see Haley than any of the old white guys she's running against. Who knows, maybe some of the public will actually learn what makes the Sikh faith different from Islam and Hinduism. And a Methodist convert would be somewhat less vulnerable to pressure from the folks behind Liberty and Bob Jones Universities. Small comforts, maybe, but any progress is good for the state, however incremental," Khalsa said.
Her family owns the Exotica International, a clothing store in Lexington, which was started by her parents Dr Ajit Randhawa and Raj in 1976. She has a sister and two bothers also.
Many women favoured Haley especially for her handling of the accusations. One told local media that it is 'Not because she's a she. She hasn't bowed down. She hasn't gotten angry. She can handle it like a gentleman, but she's a lady.'
"When you turn around and threaten their power and you threaten their money, they turn around and push back. But what they don't understand is I have a strong faith, I have a strong spine, and I have a strong husband that puts on a military uniform every day," Haley said.
"South Carolina is ready for Nikki Haley. . . . It's not about gender. It's not about ethnicity. It's about wanting somebody that's going to fight for the people, and I'm that person."
Governor Mark Sanford supported Haley from the beginning. But his popularity waned after his relation with an Argentine lady was revealed. His wife Jenny Sanford, who is very popular, divorced him. She also endorsed Haley boosting her campaign.
"I can't help but think that these attacks are being leveled at Nikki Haley because of the courageous stands she has taken over the years in defense of taxpayers and government reform -- stands that offend many of the most powerful interests in state government. I am more convinced than ever that Nikki Haley is the best person to be South Carolina's next Governor," Governor Sanford commented about the attacks on Haley.
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