Gathering a group of friends and family at a movie theater, Michaels played a special video featuring highlights of her life with Rhoades, including photos and home movies of their two children, daughter Lu and son Phoenix.
When the video ended, friends and family held up signs that read, "Will you marry me?"
The "Biggest Loser" alum then dropped down on one knee in front of a stunned and tearful Rhoades.
"I know I'm an a--hole all the time, but if you'll continue to put up with me, I would like you to marry me," Jillian told her, revealing an engagement ring to match the Rhoades' ring.
"Really?!" a shocked Rhoades replied, before saying yes.
Michaels and Rhoades, who have been dating for seven years, had been grappling with the issue of marriage all season, with Rhoades wanting to walk down the aisle years ago and Michaels not wanting to jeopardize their already great relationship.
On the finale, Michaels' reflected on her decision to marry Rhoades.
"Heidi is the perfect person for me. The only place where there's like a solace .. .a safe-haven is with my family," Michaels said. "And Heidi is the nucleus of that family. She's the glue that really holds everything together and I think without that, I would be lost."