Japan's incoming Prime Minister Naoto Kan has vowed to make the country more "vigorous", tackle national debt and improve relations with the US.
Mr Kan was speaking before being sworn in to office by Emperor Akihito.
His appointment on Friday followed the abrupt resignation of Yukio Hatoyama.
Mr Kan earlier named his new cabinet, keeping 11 of the 17 ministers in place and appointing his former deputy Yoshihiko Noda as finance minister.
Mr Hatoyama stepped down last week, amid tensions over a controversial US military base on the island of Okinawa.
Mr Kan, the former finance minister, has assured President Barack Obama that he will relocate the base to the north of the island as agreed, despite anger from locals who want it moved off Okinawa entirely.
Despite the unpopular move, Mr Kan enjoys poll ratings above 60% as his Democratic Party (DPJ) faces an election for the upper house next month.
In his televised remarks, Mr Kan said he wanted to "rehabilitate Japan drastically and create a vigorous country".
He said the national debt - the largest debt of the industrialised world, at nearly twice the country's economic output - should be "handled as the country's biggest topic".
"Rebuilding financial health is essential for Japan's economy," he said.
Mr Kan also pledged to restore the relationship with Washington, saying the Japan-US security alliance was the "cornerstone" of Tokyo's politics.
He said he would honour the agreement reached with the US over the future of the the Futenma base on Okinawa, while seeking to "ease the burden for the people of Okinawa".
Mr Kan's new cabinet was later sworn in alongside him by Emperor Akihito at the Imperial Palace.
As had been widely expected, he retained many top ministers, including Foreign Minister Katsuya Okada and Defence Minister Toshimi Kitazawa.
Mr Noda, his former deputy finance minister and a fiscal conservative, will head the finance ministry.
Among the new faces in the cabinet is Renho, a popular television presenter who goes by one name.
The 42-year-old, known for her tough questioning of bureaucrats in debates over public spending, has been appointed minister of administrative reform.
Announcing the appointments, Yoshito Sengoku, the new chief cabinet secretary, said the ministers were "young, fresh and enthusiastic about their jobs".
"Prime Minister Kan has appointed the ministers mindful of the need to form a government with professionalism, very clean politics and ability to govern," he said.
Japanese newspapers have welcomed the "son of a salary man" to the post of prime minister, contrasting his ordinary background to the privileged roots of recent prime ministers.
On Monday, Mr Kan reshuffled the DJP party leadership.
He announced that Yukio Edano would take over as secretary general of the party, replacing the powerful Ichiro Ozawa, who stepped down last week.
Shinji Tarutoko, who challenged Mr Kan for the leadership, was named the DPJ's parliamentary affairs chief.