Liz Truss, Secretary of State for Foreign, Commonwealth and Development Affairs, has been elected the Conservative leader, and will replace Boris Johnson as British Prime Minister.
Truss defeated her closest challenger, Rishi Sunak and will be UK’s third female Prime Minister after Margaret Thatcher and Theresa May.
Truss was announced at 12:30 BST and will enter office on Tuesday.
The new PM will inherit a flagging economy, with inflation at a 40-year high and soaring energy bills.
Ms Truss had promised to “act immediately” to help with energy costs.
Unveiling details of a support package will be one of her first acts as prime minister, with an announcement pencilled in for Thursday.
Energy industry sources expect the incoming government to freeze energy prices, a possible move not denied by Ms Truss’s team.
Ms Truss has been working on her energy package for weeks, based on discussion with oil and gas producers.
She also plans to deliver £30bn in tax cuts through an emergency Budget later this month, arguing the UK’s tax burden is behind sluggish growth.
Ms Truss’s expected chancellor, Kwasi Kwarteng, has argued her tax-cutting agenda will boost business investment and economic growth.
Writing in the Financial Times, he blamed “economic managerialism” for years of low growth, adding “we need to be decisive and do things differently”.