* Opposition ends ruling party's 23-year grip
* President Ramotar demands recount (Adds U.S. embassy, Granger, context)
By Neil Marks
GEORGETOWN, May 14 (Reuters) - Guyana's multiracial opposition coalition has won a national election, breaking the ruling Indo-Guyanese party's 23 year-old grip on power, the election board said on Thursday, signaling a new era in the ethnically-divided South American nation.
The APNU+AFC coalition, led by former army brigadier and publisher David Granger, won 206,817 votes, versus 201,457 for President Donald Ramotar's PPP party, the election authorities said after all votes were counted.
Ramotar said the elections were rigged and demanded a recount, without giving more details of his accusations.
Diplomats from the United Kingdom and the United States said they were free and fair, and the Guyana Elections Commission said its first tally was unlikely to change on review.
Since gaining independence from Britain in 1966, the nation of just 740,000 people has suffered tensions, and occasional violence, between citizens of Indian and African descent.
The People's Progressive Party (PPP) has ruled since 1992 and Afro-Guyanese complain they are marginalized.
But the coalition, a recent fusion between the traditional black party and a smaller third party, had campaigned to break that hegemony, cheered on by youth less hung up on ethnicity and increasingly fed up with the status quo.
"We are a six-party coalition and we are the closest Guyana has ever gotten to a government of national unity and that makes me very happy," said a beaming Granger at his Georgetown home after results were announced.
The 69-year-old has a degree in history and received military training in Nigeria, Brazil and the United Kingdom. He is the founder of a security consultancy, also worked as magazine publisher, and enjoys collecting coins.
Majority black villages erupted in celebration, with delighted supporters breaking into song and dance.
"We have shown that the old, divided way of thinking is fading and Guyana is changing," said Amir Dillwar, 24.
Granger, who is set to take the presidency, has vowed to combat corruption, increase public sector salaries and lower individual taxes.
Gold, diamond, and bauxite have boosted growth in recent years, but many Guyanese have yet to enjoy the spoils and Ramotar's government has been dogged by accusations of corruption and nepotism.
"We note the allegations ... but have found no evidence to support them," British High Commissioner Greg Quinn said in a statement about the ruling party's complaints over the vote. (Reporting by Neil Marks; Writing by Andrew Cawthorne and Alexandra Ulmer; Editing by Christian Plumb and Andrew Hay)