James will be tasked with repositioning the party now that its primary goal - taking the UK out of the European Union - has been achieved.
But in her acceptance speech, James she said the party still has work to do to make sure Brexit goes ahead and that "the threats to the referendum outcome are increasing by the day".
She said that the party is now "the change movement" in the UK, arguing that Prime Minister Theresa May has been taking Ukip's policies.
"Magpie May you've stole our two per cent defence spending," she said. "Just remember where the best ideas you steal come from."
So, Mrs May, you’re now looking, and if you’re watching TV this afternoon you’ll be watching the opposition party in waiting...Stop the faff, stop the farce and stop the fudge and get on with it. Invoke Article 50.
James has risen to the top of the party from her position as deputy chair. She said she was “deeply honoured” to be following in Farage’s footsteps and called Britain's election system “morally bankrupt”.
The announcement comes shortly after former leader Nigel Farage said Ukip must remain a strong force in UK politics because Prime Minister Theresa May is not taking a hard enough stance on Brexit.
He also said the home secretary Amber Rudd was still "fighting the referendum".
The new leader will also shape Ukip's response to the negotiations between Britain and the EU.
In his speech at the party conference in Bournemouth, Farage set out the three goals he thinks should be achieved with Brexit:
- The UK must reclaim its territorial fishing waters.
- The UK must be outside the single market
- Brits must have British passports
It's been a tough race to the finish line for Ukip leadership contenders; two of the would-be leaders were knocked out off the running in August.
Steven Woolfe, once the favourite to win, missed the deadline to enter his papers online and Jonathan Arnott withdrew later in the month because he wasn't convinced he could win.