Mr Luis Angel Gonzalez Macchi, a 51-year-old lawyer and member of the ruling Colorado Party, was sworn in as president of Paraguay late on Sunday evening, shortly after President Raul Cubas resigned, citing "conspiracies and violence".
In line with Paraguay's constitution, ex-president Cubas took up a lifetime seat in the senate, guaranteeing him immunity from prosecution for alleged crimes.
Mr Cubas's powerful ally, Gen Lino Oviedo, declared a fugitive from justice, escaped with his wife and family to Argentina but was under arrest yesterday morning on charges of entering the country with false papers.
However, Gen Oviedo was later granted political asylum according to an official statement released in Buenos Aires yesterday. "The people have triumphed" said President Macchi (pronounced Mackey) in a brief acceptance speech inside the National Palace, late on Sunday night, where he pledged an end to impunity and respect for democratic institutions.
Cars horns blared, strangers hugged each other, church bells rang and members of the fire brigade hosed down the massive crowd, as all of Paraguay seemed to swarm toward independence square in front of parliament buildings.
"This is a tribute to our glorious youth," said Father Oliva, mobbed by emotional youths who thanked him for opening the cathedral to pro-democracy protesters. Many of the youths who risked their lives at the barricades were absent from the celebrations however, as four of them lay in the city graveyard and 100 more are still in hospital.
The battle for Paraguay's fragile democracy was far from peaceful as hundreds of students first resisted police teargas and plastic bullets, then bricks and bullets from pro-Oviedo supporters and finally army tanks.
The resignation of Mr Cubas, just 224 days after he assumed power, puts an end to months of political uncertainty, in which economic activity declined, as a violent power struggle was played out between a retired coup general, a puppet president, his enemy, the vice-president, and fragile democratic institutions.
The national police force, which disobeyed orders to protect democracy activists, pledged "total subordination" to President Macchi, a ruling party deputy who served under dictator Alfredo Stroessner for almost 20 years.
The Colorado Party has ruled the country for 50 years marked by bitter infighting, but always tightening ranks around a single candidate who then dispenses power among the different power groups.
Assassinated vice-president Luis Maria Argana, a loyal ally of Alfredo Stroessner, the brutal dictator who ruled for 35 years, was a political enemy of his presidential partner Raul Cubas.
Ex-president Raul Cubas was granted asylum in Brazil yesterday, top Paraguayan and Brazilian officials announced. The announcement came only hours after a state prosecutor said Mr Cubas would be placed under house arrest on charges stemming from the deaths of five demonstrators last week.
The Brazilian Foreign Ministry said Mr Cubas was at Brazil's embassy in Asuncion and that an air force plane was on its way to pick him up. "The ambassador of Brazil in Asuncion is requesting the necessary safe conduct from Paraguayan authorities," the statement said.