Mahathir's swift and largely unexpected election victory has raised some skepticism as to whether he will hand the baton to a former foe such as Anwar.
"Dr. Mahathir in the past has been pretty ruthless — you really couldn't make up a story that he and Anwar Ibrahim would be together again," said Gerald Ambrose, chief executive officer at Aberdeen Islamic Asset Management.
The PM, who recently faced a few health issues, said on Tuesday that he may rule for one to two years.
Stepping aside for a ex-rival "would be a very un-Mahathir like move ... but then again, Anwar's party is the largest in the coalition, so Mahathir needs Anwar's continued support," said Malcom Cook, senior fellow at the ISEAS-Yusof Ishak Institute, a Singapore-based think tank.
Despite a "long and rather tortured history together, it's back to the future" for the unlikely pair, Cook said.
Wong Chen, a member of Malaysia's parliament for the constituency of Subang, emphasized that the ruling coalition was formed on the basis of Mahathir governing solely for an interim period.
Wednesday "is going to be our happy Mandela moment," Wong said. It will mark the day "that Malaysia sees the future prime minister after Dr. Mahathir hands over in two years time."
—CNBC's Sri Jegarajah contributed to this report.