Barnaby Joyce will be sworn in as the deputy prime minister after defeating Michael McCormack in a Nationals leadership spill on Monday morning in Canberra.
Mr Joyce secured a majority in the 21-member party room after long-time supporter Matt Canavan moved a spill motion.
The change in Nationals leadership could have major implications for the Morrison government, with the junior coalition partner set for a ministerial reshuffle.
Current Agriculture Minister David Littleproud has retained his role as Nationals deputy leader.
Mr Joyce failed to topple Mr McCormack at his last attempt in February last year but has prevailed at his second crack.
Mr Joyce lost his job in 2018 after a major scandal stemming from his extra-marital affair with a staffer who has now given birth to the couple's two children.
Earlier, Mr McCormack vowed not to stand aside, saying:
"If I survive then the people who actually run against me, they should think long and hard about their futures.
"They should think long and hard about the role they need to play in government.
“They should stop being so destabilising."
In a statement, Prime Minister Scott Morrison said:
“I welcome Barnaby Joyce to the role of Leader of The Nationals and soon to be Deputy Prime Minister and I look forward to working closely together to ensure Australia continues its recovery from COVID-19 and the recession it caused.
“Our focus remains on two outcomes – protecting lives and protecting livelihoods, as we continue to bolster our vaccine roll out and build on the economic recovery that has led to the creation of almost one million jobs since the beginning of the COVID-19 pandemic.
“Barnaby and I have a shared passion for ensuring our regions and rural communities thrive.
The Prime Minister also had some well-wishes to offer to his former deputy, who stood in as acting PM last week while Mr Morrison was attending trade and diplomatic meetings in Europe:
“I thank Michael McCormack for his dedicated service as Deputy Prime Minister.
“Michael will continue to be an invaluable member of the National Party, and a passionate advocate for regional and rural communities.”
In a statement, Federal President of The Nationals - also Mr McCormack's predecessor as member for Riverina and recent Queens Birthday recipient of membership of the Order of Australia, Kay Hull said:
“It is a great honour to be elected to the leadership of our great Party and I know that Barnaby Joyce understands this responsibility and will work hard to give voice to and represent the interests of those Australians who live outside our capital cities.
“I want to pay tribute to Michael McCormack, who for more than three years, has led The Nationals with passion and commitment and has helped deliver record investment in the regions and their communities.”
Mr Joyce said:
“Well, I acknowledge my faults. And I resigned as I should and I did.
“I’ve spent three years on the backbench and you know, I hope I come back a better person.
“I don’t walk away from the fact that you have to have time to consider, not only the effect on yourself, but more importantly, the effect on others.
“I’ve done that.
“I don’t want to dwell on the personal, except to say – hopefully one learns from their mistakes and makes a better person of themselves.”