Gordon Brown has been crowned Labour leader, promising to give the party not just policies but "a soul".
Tony Blair said his longtime chancellor had "all the qualities to mark him out as a great prime minister" when he takes over on Wednesday.
Mr Brown praised Mr Blair and pledged to "renew" the party to meet voters' changing aspirations.
It follows Harriet Harman's narrow win in the six-way race to succeed John Prescott as deputy Labour leader.
She pipped Education Secretary Alan Johnson by 50.4% to 49.6% in the fifth round of voting after the other four contenders' second preference votes were reallocated.
Mr Brown said from now on the party's deputy leader would also be its chairman and he pledged to give party members more of a say in policy, with "one member one vote" over its programme for government.
He also announced the appointment of Transport Secretary Douglas Alexander as general election co-ordinator, "so that we are ready not just to fight but to win a general election".
The BBC understands it is unlikely Mr Brown will appoint a deputy prime minister to replace John Prescott, with his responsibilities being given to another member of the Cabinet.
Brown's 'immediate priority'
Mr Brown was introduced to Labour activists at a special conference in Manchester by Tony Blair, who described him as a "friend for over 20 years and from today the leader of our party, very soon to be the leader of our country".
Mr Brown began his acceptance speech by saying: "It is with humility, pride and a great sense of duty that I accept the privilege and the great responsibility of leading our party and changing our country."
He singled out education and the crisis in affordable housing as two of his top priorities, promising more social housing and help for people to get on the property ladder.
But he said the NHS was his "immediate priority," adding he wanted to discuss "a new settlement for a modern NHS" with more power in the hands of patients and staff.
He pledged to eradicate child poverty and "hand more to people" through constitutional reform and strengthening local democracy.
He also pledged to tackle job insecurity, increase neighbourhood policing and do more to protect the "British way of life".
On foreign affairs, he acknowledged Iraq had been "a divisive issue for our party and our country" and he pledged to " learn lessons that need to be learned".
He described Britain as a "country of rising aspiration", saying voters had told him they wanted a "higher class" of public services "tailored to individual needs".
But he said he was a "conviction politician," adding: "The party I lead must have more than a set of policies - we must have a soul.
"Wherever we find opportunity denied, aspirations unfulfilled, potential unrealised; wherever and whenever we find injustice and unfairness, there we must be also - and it is our duty to act."
He ended his speech by promising to "heed and lead the call of change" when he took office on Wednesday.
"The new government I will lead belongs to you. I will work hard for you. I shall always try my utmost. I am ready to serve," he told Labour activists to a standing ovation.
Mr Brown's campaign manager Jack Straw said the speech would "inspire confidence and trust that this is a man to lead the nation not only up to the next election but well beyond".
He said Mr Brown had been able to "move away from the bank manager role and reach out to people" during the past six weeks as he has toured the country.
As the chancellor starts his new job as party leader, and prepares to become prime minister on Wednesday, an Ipsos/Mori opinion poll in the Observer suggested Labour had risen 4% to 39% over the past month and that Conservatives had slipped a point to 36%.
Liberal Democrat support fell from 18% to 15%, the poll suggested.
Some 1,970 UK adults were interviewed for the party share poll.
Conservative Party chairman Francis Maude said: "Harriet Harman is the first appointment of the Brown era and she believes in more money for the unions and a review of Trident.
"The country will be interested in how the unelected Gordon Brown responds to the views of the newly elected Deputy Leader of the Labour Party."
Lib Dem leader Sir Menzies Campbell called for a general election, saying: "This has been the longest coronation in history.
"Neither Labour members nor the British public have chosen the new prime minister. He should seek a mandate immediately."