Yesterday's ballot was called after Park Geun-Hye was ousted and indicted for corruption, and took place against a backdrop of high tensions with the nuclear-armed North.
Voters were galvanised by anger over the sprawling bribery and abuse-of-power controversy that brought down Park, which catalysed frustrations over jobs and slowing growth.
Moon, of the Democratic Party, who backs engagement with the North, promised unity after final results from the National Election Commission (NEC) showed he took 41.1 per cent of the vote -- some 13.4 million ballots.
Voter turnout was at its highest in 20 years, the Yonhap news agency reported. Moon's inauguration ceremony was expected to take place at the National Assembly at midday, the agency said, after the NEC confirmed the start of his mandate.
The result was "a great victory of great people" who wanted to create "a country of justice... Where rules and common sense prevail", Moon told cheering supporters on Gwanghwamun Square in Seoul -- where vast crowds gathered for candlelit protests over several months to demand Park's removal.
On the square among the crowd, Koh Eun-Byul, 28, told AFP: "I am so happy because now there is hope for some meaningful change."
Washington, which remains Seoul's most important ally and has a large security presence in the South, yesterday congratulated Moon on his landslide victory.
"We look forward to working with president-elect Moon to continue to strengthen the alliance between the United States and the Republic of Korea and to deepen the enduring friendship and partnership between our two countries," White House press secretary Sean Spicer said in a statement.
Prime Minister Shinzo Abe said he looked forward to meeting the new leader, adding: "Japan and South Korea are facing common challenges in East Asia, led by responses to the North Korean issue.
"I believe the two countries can further contribute to peace and prosperity of the region by working together."
The campaign focused largely on the economy, with North Korea less prominent. But after a decade of conservative rule Moon's victory could mean significant change in Seoul's approach towards both Pyongyang and key ally Washington.
He is seen as favouring more independence in relations with the US, Seoul's security guarantor with 28,500 troops in the country.
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