German President Horst Koehler officially appointed Karl-Theodor zu Guttenberg as the country's new economics minister Tuesday, dpa reported.
The retiring minister, Michael Glos, was openly critical of Chancellor Angela Merkel.
During Tuesday's ceremony at the presidential Bellevue palace in Berlin, the outgoing minister was formally relieved of his duties.
Glos, a senior figure in the conservative Bavarian party Christian Social Union (CSU), asked in a surprise move on Saturday to resign, briefly throwing his party into disarray. The CSU is allied with Merkel's Christian Democratic Union (CDU).
Speaking at an internal CSU meeting in Berlin, Glos said the chancellor had not included him in discussions on the current economic crisis. His complaints were quoted by people present at the meeting.
Instead, Glos said, Merkel had relied on the advice of Finance Minister Peer Steinbrueck, a centre-left Social Democrat.
Speaking of Merkel, Glos reportedly said, "She always thought I didn't have a clue about many things," according to a report by a Munich daily newspaper, the Muenchner Merkur.
"Instead," he added, "she reads the lips of Finance Minister Steinbrueck, who needs to get every sentence written down."
Within the CSU-CDU alliance, Glos said, the impression had been cultivated that he was "too stupid to read a memo."
Bavarian Premier Horst Seehofer defended Merkel from charges that she had not actively intervened in the crisis over Glos's departure.
"The chancellor was significantly more involved in the process than has been portrayed in the media," he told reporters.
The parliamentary leader of the Social Democrat (SPD) caucus, Peter Struck, said Glos' friends within his own party had prevented him from carrying out his office with any enjoyment.
Peter Ramsauer, the tough-talking head of the CSU parliamentary party in Berlin, said Glos had frequently been "jostled", and had "not received the solidarity" he had needed from certain persons, without mentioning any names.
Zu Guttenberg, aged 37, is modern Germany's youngest economics minister ever. He brings considerable foreign policy experience to the post, having spent six years as the CSU's spokesman in Berlin on disarmament and arms control.
At a news conference, zu Guttenberg referred to his experience as a chief executive of his family's company, the building supplies merchant Guttenberg, saying, "I don't just know economic theory from history books. I have also been active in implementing it."
Under a coalition accord, the CSU has the right to nominate the country's economics minister.
Zu Guttenberg's appointment is intended to bridge the time until national elections on September 27 and the dissolution of the current government.