Socialist pediatrician Michelle Bachelet became Chile's first woman president after her opponent conceded that the former political prisoner had won.
The governing centre-left coalition's win kept Chile in pace with a steady leftward trend in Latin America.
With 67 per cent of about eight million votes counted, Bachelet had 53.2 per cent of the official count to multi-millionaire businessman Sebastian Pinera's 46.7 per cent.
Pinera, who congratulated Bachelet as 'president-elect', said, "I also desire Michelle the greatest possible success."
He vowed 'to continue to fight for our principles, which do not die today'.
"Our battle continues," he said.
Bachelet's center-left coalition has governed Chile since the end of the 1973-90 dictatorship of General Augusto Pinochet. Its mix of socialist ideology with free-market economics has produced a booming economy.