Elections to the Australian Capital Territory Legislative Assembly were held on Saturday, 21 February 1998. The incumbent Liberal Party, led by Kate Carnell, was challenged by the Labor Party, led by Wayne Berry. Candidates were elected to fill three multi-member electorates using a single transferable vote method, known as the Hare-Clark system. The result was another hung parliament. However the Liberals, with the largest representation in the 17-member unicameral Assembly, formed Government with the support of independents Michael Moore, Paul Osborne, and Dave Rugendyke. Carnell was elected Chief Minister at the first sitting of the fourth Assembly on 19 March 1998.

The chief minister of the Australian Capital Territory is the head of government of the Australian Capital Territory. The leader of the party with the largest number of seats in the unicameral Australian Capital Territory Legislative Assembly usually takes on the role. Unlike other states and territories, the chief minister is not appointed by a governor or administrator, but elected directly by the Assembly.