Members of the Democratic National Committee, the administrative and fundraising arm of the party, picked Perez on the second round of voting over US Representative Keith Ellison, a liberal from Minnesota.
Following one of the most crowded and competitive party leadership elections in decades, Perez faces a challenge in unifying and rejuvenating a party still reeling from the Nov. 8 loss of Democratic presidential candidate Hillary Clinton. He immediately made Ellison his deputy.
After losing the presidency and failing to recapture majorities in Congress, party leaders are anxious to channel the growing grassroots resistance to Trump into political support for Democrats at all levels of government across the country.
"We are suffering from a crisis of confidence, a crisis of relevance," Perez, a favorite of former Obama administration officials, told DNC members. He promised to lead the fight against Trump and change the DNC's culture to make it a more grassroots operation.
Perez, the son of Dominican immigrants who was considered a potential running mate for Clinton, overcame a strong challenge from Ellison and prevailed on a 235-200 second-round vote. Ellison, who is the first Muslim elected to the US Congress, was backed by liberal leader US Senator Bernie Sanders of Vermont.
The showdown between candidates backed by the establishment and progressive wings of the party echoed the bitter 2016 primary between Clinton and Sanders, a rift Democrats will try to put behind them as they turn their focus to fighting Trump.
Those divisions persisted through the months-long race for chair, as many in the party's liberal wing were suspicious of Perez's ties to the establishment and some Democrats raised questions about possible anti-Semitism in Ellison's past.
Some Ellison supporters chanted "Not big money, party for the people" after the result was announced.
But both Perez and Ellison moved quickly to bring the rival factions together. At Perez's urging, the DNC suspended the rules after the vote and appointed Ellison the deputy chairman of the party.
"I am asking you to give everything you've got to support Chairman Perez," Ellison told DNC members after the vote. "We don't have the luxury, folks, to walk out of this room divided."