Leftist President Dilma Rousseff vowed to reconcile Brazil, reboot the economy and fight corruption after narrowly winning re-election in the most divisive race since the return to democracy in 1985.
Rousseff, the first woman president of the world's seventh-largest economy, took 51.6 per cent of the vote to 48.4 per cent for business favorite Aecio Neves in a run-off election.
After a vitriolic campaign that largely split the country between the poor north and wealthier south, Rousseff crucially picked up enough middle-class votes in the industrialised southeast to cement a fourth straight win for her Workers' Party (PT).
She will start her second four-year term on January 1 facing a laundry list of challenges: governing a polarised country, winning back the confidence of markets and investors, rebooting the stagnant economy and tackling corruption.
The 66-year-old, a former leftist guerrilla who was jailed and tortured for fighting the 1964-1985 dictatorship, called for unity in her victory speech.
And she promised to listen to voters' demands for change.
"This president is open to dialogue. This is the top priority of my second term," she told supporters in the capital Brasilia, clad in white alongside two-term predecessor Luiz Inacio Lula da Silva.
After four years of sluggish economic growth culminating in recession this year, she admitted her own report card had to improve.
"I want to be a much better president than I have been to date," she said, issuing "a call for peace and unity" after a bitter campaign of low blows and mutual recriminations.
In Sao Paulo, capital of the country's wealthiest state, Neves supporters watched the scene in disgust and chanted "Kick the PT out!"
Neves, a 54-year-old senator, called Rousseff to congratulate her.
"I told her the priority should be to unite Brazil," he told disappointed supporters in Belo Horizonte, where he served two terms as governor of Minas Gerais state.
The race was widely seen as a referendum on 12 years of PT government, with voters weighing the party's landmark social gains against Neves's promise of economic revival.
The PT endeared itself to the masses with landmark social programs that have lifted 40 million Brazilians from poverty, increased wages and brought unemployment to a record-low 4.9 per cent.
But the outlook has darkened since Rousseff won election in 2010, the year economic growth peaked at 7.5 per cent.
