In a precisely choreographed special congress in Ankara, the ruling Justice and Development Party (AKP) elected Erdogan - the only candidate - to replace Prime Minister Binali Yildirim as chairman.
Erdogan had rejoined the AKP on May 2 after a slim majority of voters on April 16 approved sweeping changes to create an executive presidency, which critics fear could lead to one-man rule.
Under the old constitution, the head of state had to sever ties with their political party and Erdogan in August 2014 left the AKP and stepped down as chairman after his election as president.
It also gives Erdogan responsibilities unmatched by any Turkish leader since 1950, with more new powers to come when the other changes agreed in the referendum to take effect from 2019.
Thousands of supporters from across Turkey crammed into the Ankara sports arena gave Erdogan a rock star-like reception at his first major party event since 2014.
"We are together again after three years," Erdogan said in his candidate speech. "Our hearts were not divided... We lived as one heart."
In a thank you speech, Erdogan vowed the congress would mark a "new start" for Turkey.
"In the next few months, from the fight against terror to the economy, from expanding rights and freedoms to investments, in every field, this new period will be a leap for Turkey."
Rejoining the AKP was the first major change permitted after the referendum, which Erdogan narrowly won with 51.4 percent of the vote.
Most measures, including axing the role of premier and giving the president the power to appoint ministers, will not come into force until elections on November 3, 2019.
Erdogan led the party for three terms during his premiership between 2003 and 2014, helping build the AKP into an all-conquering election machine that has yet to be defeated at the ballot box.
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