Carol Ann Duffy confirmed that she is the new Poet Laureate today - the first female laureate in the post's 341-year history.
Glasgow-born Duffy succeeds Andrew Motion, who has held the post since 1999.
She was widely expected to take over the role and today confirmed she had accepted the job during an interview on BBC Radio 4.
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Duffy said: "I'm really thrilled to have it properly announced on Woman's Hour and here in Manchester."
Duffy told the programme she had thought "long and hard" before saying she would take the job.
"I look on it as a recognition of the great woman poets we have writing now," she said.
"I've decided to accept it for that reason."
The 53-year-old is the latest in a line of poets which began with John Dryden and has included such great names as William Wordsworth, Alfred Lord Tennyson and John Betjeman.
Other names being circulated for the £5,000-a-year job had included Simon Armitage, Roger McGough and Benjamin Zephaniah.
The laureate is officially appointed by the Queen on the advice of the Government and until Tony Blair established a 10-year tenure in 1999, was a job for life.
Part of the laureate's remit is to write poems to commemorate major state occasions and events involving the Royal Family - a task which Motion said he found extremely difficult.
Before the new appointment was made, the Government sought advice on a replacement from academics, poetry specialists, as well as the public.
Duffy was such a favourite for the job that bookmakers stopped taking bets on her appointment.
She plans to donate her yearly sum of money for the new post to the Poetry Society to fund a prize for the best poetry collection of the year.
She said she did not want to take on such an honour and "complicate that with money".
The job also comes with a "butt of sack" - traditionally a type of wine, which nowadays translates into around 600 bottles of sherry.
Duffy said: "Andrew (Motion) hasn't had his yet so I've asked for mine up front."
Speaking about being born to Catholic parents, Duffy said: "Poetry for me is secular prayer."
Prime Minister Gordon Brown said in a statement: "I'd like to congratulate Carol Ann Duffy on her appointment as the first Poet Laureate of the 21st century and, of course, as the first woman to hold the post.
"Poetry as an art form has inspired, excited and comforted people of all ages and backgrounds for so many centuries and Carol Ann follows in a tradition set by some of the most distinguished writers in the English language.
"She is a truly brilliant modern poet who has stretched our imaginations by putting the whole range of human experiences into lines that capture the emotions perfectly and I wish her well for her ten year term."
Duffy is the author of numerous award-winning poetry collections, plays, and fairy tales and poetry for children.
Awarded an OBE in 1995 and a CBE in 2002 for services to poetry, she lives in Manchester where she is Creative Director of the Writing School at Manchester Metropolitan University.
Culture Secretary Andy Burnham said: "Carol Ann Duffy is a towering figure in English literature today and a superb poet.
"I am delighted that she has accepted the Laureateship."
He described her as "a spell-binding performer (who) writes truly wonderful storybooks and poetry for children.
"I have no doubt at all she will carry this forward and bring a new generation to poetry."
Duffy also said in a statement: "I'm very honoured and humbled to become Poet Laureate, not only when I think of some of the great poets who have occupied the post since the 17th century, but when I think of some of the wonderful poets writing now.
"The continuance of the Laureateship is important because it properly draws attention to the central role that poetry can play in the lives of ordinary people.
"Poetry is all around us, all of the time, whether in song or in speech or on the page, and we turn to it when events, personal or public, matter most.
"In accepting this Laureateship, I hope to contribute to people's understanding of what poetry can do, and where it can be found."
Earlier this week Motion said he was "relieved" to be leaving the job.
Glasgow-born Duffy, the first Scot to take on the role, was mooted for the job when it was given to Motion but missed out amid rumours that former prime minister Tony Blair was worried about how "Middle England" would react to a lesbian laureate.
The title poet laureate owes its name to the laurels used by ancient Greeks to crown their most celebrated poets.
The role initially involved penning odes to celebrate events such as the monarch's birthday, although in modern times the job is more what the holder makes of it.
Although many poets have enjoyed royal favour, the official origins of the post date back to the 17th century.
In 1668, King Charles II gave John Dryden the title of poet laureate and historiographer royal in a royal warrant.
The king hoped that Dryden would act as an advocate for him in the turbulent times following his restoration to the throne.
But this early attempt at spin ended badly for Dryden when James II, who followed Charles to the throne, was ousted by William III in 1689.
Catholic Dryden refused to swear the oath of allegiance to a Protestant king and was sacked - the only time a poet laureate has been fired.
Since 1790 the position has been awarded on the advice of the prime minister, who submits names for the monarch's approval.
With George IV taking the throne in 1820, the need for regular odes to the monarch was not as great and the post became much more flexible.
William Wordsworth was reassured by prime minister Sir Robert Peel that no specific duties would be required.
By the 20th century, holders of the post interpreted their roles in varying ways.
In 1972, Sir John Betjeman had the post's original salary of £200 a year and a butt of canary or a butt of sack - a type of wine - revived.
A payment of sherry has come with the post's salary in modern times.
Andrew Motion held the position from 1999, when it became fixed for a 10-year period for the first time.
Previous appointees stayed in the role until their deaths.
Motion's works have covered subjects such as the 100th birthday and the death of the Queen Mother and the Queen's 80th birthday.
The Government sought advice on a replacement from academics and poetry specialists, as well as the public, before the appointment of Carol Ann Duffy, confirmed today.
Giving advice to his successor on Radio 4's Front Row last November, Motion said that whoever took over from him should take "steps to preserve your privacy".
He said: "No matter how well-known you are as a writer, it's almost impossible to imagine what it is like being jerked out of one semi-private life into a more or less public life."
The new poet laureate should also learn "how to resist courteously the enormous rush of invitations to do things that will undoubtedly come to this person and risk overwhelming them", he said.