The outcome of the Landrieu showdown with Terrell could determine control of the Senate depending on the outcome of other Senate races around the country.
With nearly 100 percent of the vote counted, Landrieu had 47 percent and Terrell, with 26 percent, was her closest challenger. There were seven other candidates in the primary, three of them Republicans.
Speaking to a rally, Landrieu called the outcome a "great victory" though she faces what is expected to be a well-financed challenge from Terrell.
"We're going to tell the truth in this campaign about the issues that matter," she said, "Our opponents said from the beginning they would be with the president 100 percent of the time. I stood with him on the Iraq resolution ... but when the president proposes privatizing Social Security, imposing steel tariffs on our port, or cutting Medicare benefits, I'm going to be for the people of Louisiana."
Asked whether she wished she had run a tougher attack campaign against her opponents, Landrieu answered, "We would have loved to go over 50 percent, but we were running against eight candidates. This is a great victory."
Landrieu was joined on the stage by her large extended family, including her father, former New Orleans Mayor Moon Landrieu. She carried 75 percent of the vote in Orleans Parish (New Orleans).
Terrell said she looks forward to the campaign.
"The people of Louisiana are looking for a change. There were plenty of Republicans in this race; there were Independents, there were Libertarians; but there was only one Democrat, and that Democrat has a long history and started with $6 million to our zero on July 16," she said.
(Reported by Kathy Finn in New Orleans and Phil Magers in Dallas)