This is the second time that Amarinder, 75, has become Chief Minister of the state. He earlier held the office from 2002 to 2007.
The swearing-in ceremony was attended by former Prime Minister Manmohan Singh and Congress Vice President Rahul Gandhi.
Congress, in the just concluded assembly elections, won 77 seats out of 117, thereby getting a clear majority.
Navjot Singh Sidhu took the oath as a cabinet minister.