With 42 per cent of the estimated vote counted, CNN showed El-Sayed leading Stevens by 49.8 per cent to 46.5 per cent.
The contest has emerged as one of the clearest tests yet of the direction of the Democratic Party, pitting El-Sayed's campaign against Stevens, an establishment-backed moderate supported by Democratic leaders and pro-Israel groups.
The winner will face Republican Mike Rogers in November in a race critical to Democrats' hopes of regaining control of the US Senate.
The race was being closely watched for clues about whether Democratic voters in a crucial swing state are receptive to candidates who challenge party leaders and champion an agenda focused on lowering costs, expanding healthcare coverage and restricting the role of big money in elections.
The race is the latest battleground between progressives and moderates over US support for Israel, an issue that has played out in primaries nationwide this year. But unlike contests in liberal bastions, this is a statewide race in a Midwestern swing state for a seat Democrats must win in the fight for Senate control.
Michigan is both a presidential battleground and home to one of the country's largest Arab American communities, making it an important testing ground for Democrats' electoral and ideological future.
US Representative Debbie Dingell, a Michigan Democrat who stayed neutral in the primary, said the party needs to quickly coalesce behind its nominee because too much is at stake.
"This race is about how people are hurting," she said in an interview, citing cost concerns over groceries, gas, rent and healthcare as the issues that will matter in November.
The race is likely to be scrutinised by prospective 2028 presidential contenders searching for a message to reconnect with voters after the party's 2024 defeat. A victory for El-Sayed could intensify debate within Democratic ranks over the political appeal of economic populism, anti-establishment campaigning and a tougher approach toward Israel.
Voters in Michigan, Virginia, Missouri, Kansas and Washington state decided on US House candidates in Democratic primaries on Tuesday, including a handful that could determine whether the party retakes the lower chamber. Four of those races are considered general election toss-ups.
