Gen. Abdel-Fattah Burhan was sworn in before the country's top judge and will lead the 11-member Sovereign Council for 21 months, followed by a civilian leader appointed by the pro-democracy movement for the next 18.
The long-awaited move came after more than four months of tortuous negotiations between the ruling military council and the pro-democracy movement following the army's removal of longtime autocratic president Omar al-Bashir in April.
The new Sovereign Council was established under a power-sharing agreement between the military and the protesters, following pressure from the United States and its Arab allies, amid growing concerns the political crisis could ignite a civil war.
The 59-year-old Burhan chaired the military council that took over the country after al-Bashir's ouster amid nationwide protests against his three-decade rule.
The Sovereign Council includes five military members and five civilians appointed by the Forces for Declaration of Freedom and Change, which represents the protesters. An 11th member, a Coptic Christian judge, was appointed by the two sides.
According to the official news agency, nine members were sworn in before the country's top judge and Burhan on Wednesday. The remaining member, Mohammed Hassan al-Taishi, will be sworn in later.
SUNA news agency said the council held its first meeting in the capital of Khartoum after the members took the oath of office.
University professor Aisha Musa, a member of the Sovereign Council, called the swearing-in a "historic day" and vowed to work toward achieving "full civilian" administration.
"Your sovereign council has crowned your revolution, which came to achieve slogans of citizenship, peaceful coexistence, democracy and balanced development," she said in a televised news conference after the meeting.
Raja Nicholas Issa, the Coptic Christian member on the council, said the council would start talks with armed groups to "make peace and achieve justice across the country."
Sudan has also been convulsed by rebellions in its far-flung provinces for decades, and the power-sharing agreement calls for the government to reach a peace agreement with the rebels within six months.
The U.N. Security Council welcomed the inauguration of Burhan and the Sovereign Council, saying "these are important steps to deliver peace and security for the people of Sudan" — and to set the country "on the path to a democratic future."
The council commended the commitment of the Sudanese people to a peaceful transition, and welcomed the parties' pledge to respect human rights and fundamental freedoms. It called for a swift resumption of negotiations to peacefully end conflicts in Darfur, South Kordofan and Blue Nile.
Among the military members on the council is Gen. Mohammed Hamadan Dagalo, who served as deputy head of the disbanded military council.
Dagalo, also known as Hemedti, has consolidated power since al-Bashir's overthrow, and is the commander of the paramilitary Rapid Support Forces. Protesters accuse the RSF of leading the crackdown against them that started with the brutal break-up of their sit-in camp in Khartoum earlier in June.
The civilian members include two women and a journalist.
The power-sharing agreement, signed Saturday, includes a protest movement-appointed Cabinet and a legislative council with a majority from the Forces for the Declaration of Freedom and Change, the main protest coalition. The legislative body is to assemble within three months.
The pro-democracy movement appointed well-known economist Abdalla Hamdok to lead the transitional Cabinet in a sign that overhauling Sudan's ailing economy would be a top priority for the new administration.
Videos circulated online showed dozens of people waiting for Hamdok's arrival at Khartoum international airport. They were heard chanting: "Blood for blood even if it's civilian (government)."
They were calling for justice for those killed in the uprising that started late last year, initially over bread and fuel shortages, but which shortly turned to calls for al-Bashir's ouster. At least 250 people have been killed since December.
Upon his arrival from the Ethiopian capital of Addis Ababa, Hamdok told reporters that the transition period "requires all efforts" to "unite" the Sudanese and build a strong country.
Hamdok said his government would work achieve "sustainable peace" with armed groups. Overhauling the economy would also be a top priority for the government, he said.
"The slogan of 'Freedom, peace and justice" will be the program of the transitional period," he told a press conference.
He also said the Sudanese women would be represented fairly in his government, hailing their role in "the greatest revolution in our recent history."
Hamdok, who has served as deputy executive secretary of the United Nations Economic Commission for Africa since November 2011, was sworn in Wednesday. He holds a doctorate in economics from the University of Manchester in the U.K., and was a senior official at Sudan's Finance Ministry in the 1980s, before the Islamist-backed military coup in 1989 in which al-Bashir took over power.
Hamdok is tasked with forming a Cabinet of not more than 20 ministers, but the military will nominate the defense and interior ministers.
Along with overhauling the economy, the new administration will have to adopt "comprehensive reforms" to the judiciary in order to achieve "transitional justice," said Rasha Awad, editor of the online Sudanese newspaper Altaghyeer.
She said the military members might impede such reforms as "it will include the armed forces and might threaten their interests."
Al-Bashir's trial is another top challenge, she said.
The deposed former president, who has been in custody since his ouster, has been charged with corruption and involvement in the killing of protesters during the popular uprising.
Al-Bashir is wanted by the International Criminal Court on charges of war crimes and genocide linked to the Darfur conflict in the 2000s, but the Sudanese military has said it would not extradite him to The Hague.
Al-Bashir was the only sitting head of state for whom an international arrest warrant has been issued by the Netherlands-based tribunal.