Raul Castro was named president of Cuba on Sunday, ending his brother Fidel Castro's 49-year rule but keeping the country on a communist path.
Raul Castro, 76, nodded and smiled as legislators applauded his election by the rubber-stamp National Assembly.
Raul Castro is widely expected to bring some economic reforms to Cuba's economy but in a sign that change is unlikely to be deep or abrupt, hardline communist party ideologue Jose Ramon Machado Ventura, was named first vice president, or Cuba's No 2.
In his first speech as Cuba's new leader, Raul Castro said he could continue to consult Fidel Castro on important decisions of state.
"This is about signaling continuity externally and internally," said Julia Sweig, an expert on Cuba at the Council on Foreign Relations think tank in Washington, although she said Cuba's leaders are well aware they need to address food shortages and other problems.
"Raul is really a pragmatist and for all of them the clock on bread and butter issues starts ticking now," she said.
Raul Castro has led the West's last communist state since July 2006 when long-time US foe Fidel Castro temporarily handed over power after undergoing intestinal surgery. The bearded revolutionary officially retired on Tuesday.
A leftist icon in his army fatigues, cap and beard but oppressor of his people to his foes, Fidel Castro overthrew US-backed dictator Fulgencio Batista in 1959.
He then survived assassination attempts, a CIA-backed invasion, the Soviet Union's collapse and a US economic embargo to rule for almost half a century.
Since his operation, the charismatic 81-year-old leader has not been seen in public and television footage shows him to have grown frail and shuffling, posing in a Cuban athletic team tracksuit instead of his trademark fatigues.
He will continue to wield influence as the head of the Communist Party and by writing articles on world affairs in what he calls "the battle of ideas".
Raul Castro lacks the oratorical flair of Fidel, whom he converted to communism, but he has encouraged ordinary Cubans in the last 19 months to air their concerns over shortages and inefficiencies in the economy.
The US administration has dubbed him "Fidel Lite" and criticized the leadership transition as the handing of power from one dictator to another.
Secretary of State Condoleezza Rice on Sunday urged Cuba in a statement to move further toward democracy.
"We urge the Cuban government to begin a process of peaceful, democratic change by releasing all political prisoners, respecting human rights, and creating a clear pathway towards free and fair elections," she said.
(Additional reporting by Marc Frank, Editing by Michael Christie and Kieran Murray)