The 30th Dáil has elected Bertie Ahern to an historic third term as Taoiseach in a three-party coalition between Fianna Fáil, the Green Party and the Progressive Democrats.
Mr Ahern is the first Taoiseach to serve three terms since Éamon De Valera.
The new government is also supported by a number of independent TDs giving Mr Ahern a comfortable majority.
Mr Ahern became Taoiseach shortly before 4pm this afternoon following a ballot when 89 deputies voted in favour and 76 against him taking office.
Mr Ahern was nominated by his deputy, Brian Cowen, and supported by the Green's Trevor Sargent, the PDs Mary Harney and Independent TD Jackie Healy-Rae.
Fine Gael's Richard Bruton, seconded by Labour's Pat Rabbitte, nominated Enda Kenny as Taoiseach, while Sinn Féin said they would oppose both nominations.
Mr Ahern said he was "honoured and humbled" by the mandate he had received from the people.
"It is an honour I will work with all my might to repay," he added.
The Fine Gael leader Enda Kenny, congratulated Mr Ahern for his "persistence" and "permanence" on the Irish political scene.
"I suppose we should all be glad for small mercies that you have decided to start the long glide to retirement as you have announced already," he added.
The Dáil then adjourned to allow the Taoiseach to travel to Áras an Uachtaráin to sign the warrant of appointment.
The day's proceedings opened at 3pm when the clerk of the Dáil, Kieran Coughlan, read the Proclamation of the President of Ireland dissolving and convening Dáil Éireann.
The first business undertaken by the Dáil was to elect John O'Donoghue as the new Ceann Comhairle.
Mr O'Donoghue was nominated by Mr Ahern, however, a ballot was triggered when the Labour leader Pat Rabbitte, seconded by Fine Gael leader Enda Kenny, nominated Ruaraí Quinn to the position.
The Dail then adjourned to vote on the nomination.
After the ballot Mr O'Donoghue said it was an honour for him to be elected to the position and said he would do his best to "deal fairly with each and every deputy in the house".
Shortly after 7pm this evening Mr Ahern named his new cabinet with Brian Cowen named as Tánaiste and maintaining his role as Minister for Finance.
Other changes saw Brian Lenihan promoted as the new Minister of Justice, Seamus Brennan became the Minister for the Arts, Sport and Tourism while Martin Cullen replaced him in the Department of Social and Family Affairs. Noel Dempsey became the Minister for Transport & Marine.
Eamonn Ryan in Communications, Energy & Natural Resources, and John Gormley in Environment, Heritage & Local Government became the first ever Green Party ministers.
The former Minister for the Environment Dick Roche was dropped from the front bench but was named as Minister of State for European Affairs. All the other Departments remained unchanged with Mary Harney retaining the Department of Health and Tom Kitt continuing as the Government Chief Whip.
Mr Ahern also appointed Paul Gallagher SC as the new Attorney General.
For the Green Party, today was a major step as they enter government for the first time in the party's history after its members voted by an overwhelming majority in favour of a deal hammered out with Fianna Fáil after ten days of negotiations.
Apart from the two ministerial posts the Greens will also get two junior ministerial posts, which means that four of the party's six TDs will get office under the deal.
Trevor Sargent, who announced last night that he would honour his earlier pledge to step down as party leader rather than lead the Greens into government with Fianna Fáil, said he would not take up a cabinet position but would accept a junior ministry if offered one.
Former Fine Gael minister and Independent TD for North Tipperary Michael Lowry confirmed yesterday he has agreed to support Fianna Fáil.
Independent TD for Kerry South Jackie Healy-Rae signed a deal with Mr Ahern on Monday that is worth tens of millions of euro for his constituency, while Finian McGrath, an Independent TD in Dublin North Central, also agreed a package in exchange for support.
In total, 166 TDs were elected in the general election to represent constituencies across Ireland, including 38 newly appointed members.
Once this official business is completed, the Dáil is due to sit again on Tuesday 26th June at 2.30pm and resume regular sittings until it rises for the summer recess in the first or second week of July.