After the election count on Saturday (May 8) the local authority remains in no overall control and its previous administration - the Liberal Democrats - is no longer the largest party, with 15 seats.
The prior second largest party, the Conservatives, made gains to become the biggest group with 16 seats.
But neither parties have enough seats for a majority.
It had been planned Councillor Gerald Vernon-Jackson, who has helmed the Lib Dems since 2004 and is technically still leader of the council, would be stepping down from his leadership role after the elections.
But he has now confirmed he will keep his position, after his deputy Steve Pitt lost his seat in Central Southsea in a surprise result at the weekend.
This also gives him the opportunity to contend for his position as council leader.
A statement from the Lib Dems said: ‘The Liberal Democrat group at Portsmouth City Council met yesterday.
‘In view of the need for continuity during the pandemic and the recovery afterwards, the Lib Dem councillors asked Gerald Vernon-Jackson to continue in his role as leader of the city council. Gerald has agreed to do this.
‘Suzy Horton will become Deputy Leader.’
The group has not yet revealed if it would be looking to form alliances with other groups or independent members in the council.
New Tory leader, Cllr Matthew Atkins - who succeeded Donna Jones after Saturday, told The News the results gave his party a ‘mandate’ for leadership.
He said: ‘We are looking to take control of the city council.
'With us being the largest party, it should be us in leadership with the confidence-and-supply from another party.’
But he added his group was 'open to working with everyone.'
The results of Saturday's count - at which a third of the council's 42 seats were contested - left the Labour party with seven seats, the Progressive Portsmouth People (PPP) with two and two independent councillors.
Speaking about possible coalitions Cllr Claire Udy - the boss of PPP - said: 'Cllr Gerald Vernon-Jackson knows of the invaluable knowledge and experience we could bring to an administration.
'With an interest in culture and looking towards a green and local-based recovery post Covid, it would be silly for him no to even consider working with us for the betterment of the people of Portsmouth.'
The city's Labour group was approached for comment.
A council leader will be chosen during the annual general meeting on Tuesday, May 18.