However, the unwieldy coalition with the small centre-right NCD party on which he will depend for a majority remains unchanged from the one which hampered Letta's efforts at reform and he faces a fractious parliament which has proved difficult for past governments to control.
The newly installed cabinet met for the first time on Saturday and Renzi is expected to go before the Senate on Monday for the first of two parliamentary confidence votes next week where he will give more detail on his policy program.
Renzi becomes the third prime minister in succession to be appointed without an election victory behind him and although the constitution does not formally require it, his lack of a mandate from voters may limit his ability to push through tough reform measures.
Moreover, the bitterness left by the leadership struggle was palpable in a handover ceremony which was over in seconds, with a stony-faced Letta offering the briefest of handshakes before leaving the prime minister's office for the last time.
(Read more: Spain, Italy yields head back to 8-year lows)
The new prime minister's main experience in government has been as mayor of the city of Florence and many of his ministers will also be learning on the job.
But media commentators and opposition politicians were quick to point to similarities between the new and old governments—five of ministers have remained in the cabinet and another, Graziano Delrio, has become Renzi's chief of staff.
The oldest member of the cabinet, 64-year-old Economy Minister Pier Carlo Padoan, former chief economist at the Organisation for Economic Cooperation and Development, will play a key role in maintaining the confidence of partners ranging from the European Central Bank to foreign investors.
The other main economic ministers, Industry Minister Federica Guidi, a former official at employers' association Confindustria, and Labour Minister Giuliano Poletti, former head of the cooperative association Legacoop, will face pressure on industrial policy.
Underlining the stakes, UILM union leader Palombella said Italy's loss of its industry could eventually lead to it joining Greece in being placed under special administration by European authorities and the International Monetary Fund.
Among the new government's priorities will be cutting taxes on business and overhauling labor market rules that deter employers from taking on new permanent staff, but in both cases it will be bound by tight constraints.
Italy's European Union partners have made clear they are unwilling to give the new government room to breach tight borrowing limits while unions have opposed moves to loosen strict hiring and firing rules.
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