France's new President Nicolas Sarkozy has taken office at a ceremony in the Elysee Palace, after waving goodbye to President Jacques Chirac.
The new centre-right president succeeded his former mentor after defeating the Socialists' Segolene Royal in the 6 May run-off election.
In his inaugural address, Mr Sarkozy called for change and national unity.
He said his first decision was to make all schools read a letter home written by a World War II resistance fighter.
'We need results'
Mr Sarkozy said France needed "to take risks and follow initiatives".
The country also needed to "rehabilitate the values of work, effort, merit and respect" and defeat intolerance, he said.
A 21-gun salute marked his assumption of the presidency, after a brief private conversation with Mr Chirac.
One of Mr Chirac's last tasks was to hand over the launch codes of France's nuclear arsenal.
Mr Sarkozy, 52, was accompanied at the ceremony by his wife Cecilia, wearing an eye-catching golden dress, and other family members - their son Louis and four children from their previous marriages.
In his speech Mr Sarkozy attacked racism and stressed that "order and authority is needed" to deal with security challenges.
Unemployment 8.3%, highest for 25 years
Sluggish economic growth
Social tensions, especially in deprived Paris suburbs
Championed failed European constitution
Led French opposition to invasion of Iraq
"We need results because the French people in their daily lives need improvements... We need to invent new solutions."
He warned that "never have the risks of inertia been so great for France" as in today's fast-moving world.
But he vowed to "defend the independence of France... the identity of France".
He also called for "a Europe that protects" and the development of "a Mediterranean union".
Mr Sarkozy later rekindled the flame on the tomb of the unknown soldier at the Arc de Triomphe.
He said he could never read the letter from a young resistance fighter, Guy Moquet - who was executed in 1941 - to his parents without being "profoundly moved".
Mr Sarkozy said it was essential children knew the horror and barbarism of war and the extent of Moquet's sacrifice.
On Tuesday, Mr Chirac bade farewell to the nation in a televised address after 12 years at the Elysee.
The BBC's Paris correspondent Caroline Wyatt notes that Mr Chirac leaves behind unemployment of more than 8% and a nation uncertain of its place in the world and divided over its future.
Mr Sarkozy, formerly interior minister, has a reputation as a law and order hardliner. He made the fight against illegal immigration and crime prominent in his election campaign, along with the issue of national identity. For the first time modern France is now being ruled by an immigrant's son.
"The people conferred a mandate on me... I will scrupulously fulfil it," he promised. He won with 53% of the vote and enjoys a powerful mandate after a massive turnout by the electorate.
He praised Mr Chirac's contributions to peace and the environment. The two men have been both allies and foes over the past 30 years.
Mr Sarkozy is later to travel to Berlin to meet German Chancellor Angela Merkel, a key ally and the current president of the European Union.
Mr Sarkozy is not expected to name his prime minister and cabinet until Thursday.
A former minister, Francois Fillon, is expected be made prime minister.
Reports also suggest that a senior member of the defeated Socialist party, Bernard Kouchner, is a leading candidate for the post of foreign minister.