CDU first minister Stanislaw Tillich said his party, which took 39.4 percent of the vote, would not be forming an alliance with the eurosceptic Alternative for Germany (AfD) party, which made its first entry into a state legislature with 9.7 percent of ballots.
The agreement of a CDU-Social Democratic (SPD) coalition following the 2013 federal election will likely be repeated in miniature in Saxony.
“We're looking for a partner with whom we can together achieve something for the state,” Tillich told ARD television. “And certainly the AfD isn't among them.”
Tillich's federal colleague, Chancellor Angela Merkel, was dismissive of the AfD's gains.
"A big part of this result is a protest vote," she told reporters on Monday. "We, the CDU, need to address the issues [that concern voters] and solve these problems -- that is how these protests can be quelled."
Tillich has said that he favours a coalition with the SPD, which gained two percent to take 12.4 percent of votes. The two parties governed together during the 2004-09 legislature and pollsters Wahlen found that 55 percent of Saxons hope they will repeat the agreement.
Interim CDU leader in the Bundestag, Thomas Strobl, told the Leipziger Volkszeitung that “the AfD doesn't fit into Germany as an exporting country and doesn't fit with the European party that is the CDU.”
Left politicians including SPD Vice-Chancellor Sigmar Gabriel and Green president Cem Özdemir had already warned the CDU against entering a coalition with the “right populist” party.
AfD lead candidate Frauke Petry, a 39-year-old chemist, campaigned on family issues, calling for more couples to have children and tighter restrictions on abortion.
The party also called for a state referendum on the building of mosques with minarets.
In a strange twist to the election story, hackers released names, addresses and telephone numbers of AfD members in Saxony on Monday. It's not known what they hoped to achieve by the leak.
The FDP reached just 3.8 percent, failing to cross the five percent threshold to remain in the state parliament and continuing the party's slide into irrelevance following its removal from the national parliament in last year's elections.
And the far-right German National Democratic Party (NPD) also dropped out of the parliament after achieving a share of 4.95 percent of the vote.
The second-largest party in the state parliament remained the Linke (Left) party at 18.9 percent.
Two more eastern German states, Thuringia and Brandenburg, will be voting for their state representatives on September 14.