Sean Penn took home his second best actor Oscar, winning for his portrayal of slain San Francisco politician and gay rights activist Harvey Milk in "Milk."
Riffing on Hollywood's perceived political leanings, Penn's first words upon accepting the Oscar were: "You commie, homo-loving sons of guns."
Penn's win was maybe the only real upset of the evening, beating out Mickey Rourke, who had bested Penn at the Golden Globes last month for his titular role in "The Wrestler."
Kate Winslet won best actress for playing a Nazi concentration camp guard in the "The Reader."
Winslet, who had been nominated five previous times, said: "I'd be lying if I said I haven't made a version of this speech before. I think I was probably 8 years old and staring into the bathroom mirror, and this would have been a shampoo bottle, " she said, indicating her statuette. "Well, it's not a shampoo bottle now."
Heath Ledger was posthumously awarded the best supporting actor Oscar for his role as the Joker in the "Dark Knight."
Ledger died Jan. 22, 2008, following an accidental drug overdose in his New York apartment. Ledger's parents and sister accepted the Oscar on their son's behalf and said it would be given to his 3-year-old daughter, Matilda.
In accepting the award, Ledger's father, Kim Ledger, called the role "this crazy Joker character." Some have speculated that delving into the dark role -- an insane criminal clown -- led Ledger to become depressed.
Ledger, who was 28 when he died, joins 1976 best-actor winner Peter Finch of "Network" as the only other performer to win an Oscar after his death.
Penelope Cruz won the best supporting actress award for "Vicky Christina Barcelona," and "Wall-E," the morality tale cleverly disguised as romance about robots, won for best animated feature.
Cruz took home the first Oscar statuette awarded at this evening's Academy Awards for her role as a mentally unstable Spanish woman in Woody Allen's film about a volatile three-way relationship.
"Thank you, Woody, for trusting me with this beautiful character," said Cruz, a first-time Oscar winner who starred alongside fellow Spaniard Javier Bardem.
The awards followed an opening musical number by host Hugh Jackman meant to spoof the nominated films. Hamming it up to Broadway-style show tunes, Jackman sang about the films in front of recession-inspired set pieces made from old pizza boxes and strips of foil.
The following is the complete list of Academy Award winners
Motion Picture: "Slumdog Millionaire."
Actor: Sean Penn, "Milk."
Actress: Kate Winslet, "The Reader."
Supporting Actor: Heath Ledger, "The Dark Knight."
Supporting Actress: Penelope Cruz, "Vicky Cristina Barcelona."
Director: Danny Boyle, "Slumdog Millionaire."
Foreign Film: "Departures," Japan.
Adapted Screenplay: Simon Beaufoy, "Slumdog Millionaire."
Original Screenplay: Dustin Lance Black, "Milk."
Animated Feature Film: "Wall-E."
Art Direction: "The Curious Case of Benjamin Button."
Cinematography: "Slumdog Millionaire."
Sound Mixing: "Slumdog Millionaire."
Sound Editing: "The Dark Knight."
Original Score: "Slumdog Millionaire," A.R. Rahman.
Original Song: "Jai Ho" from "Slumdog Millionaire," A.R. Rahman and Gulzar.
Costume: "The Duchess."
Documentary Feature: "Man on Wire."
Documentary (short subject): "Smile Pinki."
Film Editing: "Slumdog Millionaire."
Makeup: "The Curious Case of Benjamin Button."
Animated Short Film: "La Maison en Petits Cubes."
Live Action Short Film: "Spielzeugland (Toyland)."
Visual Effects: "The Curious Case of Benjamin Button."