The former chairman of Northern Rock, who resigned over his role in the bank's near collapse, has won a seat in the House of Lords.
Viscount Ridley, a scientist and journalist, was elected by other Conservative hereditary peers following the death of Earl Ferrers.
Former Tory MP Douglas Hogg failed in his attempt to return to Parliament.
Twenty-seven peers stood in the contest, in which there were only 48 eligible voters.
After constitutional reforms in 1999, all but 92 hereditary peers were expelled from the House of Lords.
In the event of the death of one of them, a by-election is held in which other hereditary peers belonging to the same party as the deceased can stand.
Viscount Ridley, better known as Matt Ridley, has written a number of books and has a regular column in the Wall Street Journal. He is also known for holding sceptical views on climate change.
His book the Rational Optimist, in which he looks at how human prosperity has evolved, was shortlisted for the Samuel Johnson non-fiction prize in 2011.
Viscount Ridley finished first in the by-election with 14 votes, beating Douglas Hogg - also known as Lord Hailsham - who came second with 11 votes and the Earl of Harrowby, who came third with eight votes.
He is the nephew of the late Tory cabinet minister Nicholas Ridley and the brother-in-law of Environment Secretary Owen Paterson. He inherited his title following the death of his father in March last year.
He was chairman of Northern Rock from 2004 to 2007 and has said he feels "nothing but remorse" for his role in the bank's difficulties during the financial crisis.
Former agriculture minister Lord Hailsham quit as an MP at the 2010 general election after he attracted criticism for using parliamentary expenses to pay for dredging a moat on his country estate.
He has always denied that the money was used for this purpose, instead claiming it was to clean out a drainage ditch, but agreed to pay back the £2,200 bill he submitted.
His wife, Baroness Hogg, sits as a crossbencher in the Lords having been made a life peer by former Tory Prime Minister Sir John Major.