Trump's defeat capped one of the worst periods of his campaign, a brutal stretch that highlighted his weaknesses with women and raised questions about his policy depth. While the billionaire businessman still leads the Republican field, Cruz and an array of anti-Trump forces hope Wisconsin signals the start of his decline.
"Tonight is a turning point," Cruz told cheering supporters at a victory rally. "It is a call from the hardworking people of Wisconsin to America. We have a choice. A real choice."
Cruz, a Texas senator with a complicated relationship with Republican leaders, also cast his victory as a moment for unity in a party that has been roiled by a contentious primary campaign.
But Trump was unbowed. His campaign put out a biting statement: "Ted Cruz is worse than a puppet--- he is a Trojan horse, being used by the party bosses attempting to steal the nomination from Mr. Trump."
Sanders's sweeping win in virtually every county in Wisconsin, except Milwaukee, gives him greater incentive to keep competing against Clinton. But he still trails her in the pledged delegate count and has so far been unable to persuade superdelegates- the party officials who can back any candidate - to drop their allegiance to the former secretary of state and back his campaign.
At a raucous rally in Wyoming, Sanders cast his victory as a sign of mounting momentum for his campaign.
"With our victory tonight is Wisconsin, we have now won 7 out of 8 of the last caucuses and primaries," he declared.
The results in Wisconsin make it likely both parties' primaries will continue deep into the spring, draping front-runners Trump and Clinton in uncertainty and preventing both from fully setting their sights on the general election.
With an overwhelming white electorate and liberal pockets of voters, Wisconsin was favorable territory for Sanders. In a sign of Clinton's low expectations in the Midwestern state, she spent Tuesday night at a fundraiser with top donors in New York City.
Clinton congratulated Sanders on Twitter and thanked her supporters in Wisconsin. "To all the voters and volunteers who poured your hearts into this campaign: Forward!" she wrote.
Sanders' win will net him a handful of additional delegates, but he'll still lag Clinton significantly. With 86 delegates at stake in Wisconsin, Sanders will pick up at least 44 and Clinton will gain at least 28.
That means Sanders must still win 67 percent of the remaining delegates and uncommitted superdelegates in order to win the Democratic presidential nomination.
While Trump has been the dominant force in the Republican race, he battled a series of campaign controversies in the lead-up to Wisconsin, including his campaign manager's legal problems following an altercation with a female reporter and his own awkward stumbles in clarifying his views on abortion. Wisconsin's Republican establishment, including Gov. Scott Walker, has also campaigned aggressively against the businessman.
Exit polls in the state underscored the concerns about Trump that are surging through some corners of the Republican Party. A majority of Republican voters said they're either concerned or scared of a potential Trump presidency. More than a third said they were scared about what Trump would do as president, and about 2 in 10 said they were concerned, according to surveys conducted by Edison Research for The Associated Press and television networks.
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The Texas senator was poised to collect most of Wisconsin's 42 Republican delegates.
Trump still has a narrow path to claim the nomination by the end of the primaries on June 7. But by losing Wisconsin, the real estate mogul has little room for error in upcoming contests.
Complicating the primary landscape for both Cruz and Trump is the continuing candidacy of John Kasich. The Ohio governor's only victory has come in his home state, but he's still picking up delegates that could otherwise help Trump inch closer to the nomination or help Cruz catch up.
To win a prolonged convention fight, a candidate would need support from the individuals selected as delegates. The process of selecting those delegates is tedious, and will test the mettle of Trump's slim campaign operation.
Cruz prevailed in an early organizational test in North Dakota, scooping up endorsements from delegates who were selected at the party's state convention over the weekend. While all 28 go to the national convention as free agents, 10 said in interviews they were committed to Cruz. None has so far endorsed Trump.
Despite the concern among some Wisconsin Republicans about Trump becoming president, nearly 6 in 10 GOP voters there said the party should nominate the candidate with the most support in the primaries, which so far would be Trump. Even among voters who favored Cruz, 4 in 10 said the candidate with the most support going into the convention should be the party's nominee.
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