The former revolutionary guard won a shock election victory in June, and was on Wednesday formally installed at a ceremony led by supreme leader Ayatollah Ali Khamenei.
He takes the helm as his country faces mounting pressure over its nuclear ambitions.
In his first address, President Ahmadinejad appealed for an end to weapons of mass destruction in the world, a day after the West issued sharp warnings to Tehran over its threatened violation of a deal suspending its nuclear programme.
But after formally endorsing Ahmadinejad as president, Ayatollah Khamenei ordered the new government not give up “the rights of the nation.”
“Iranian leaders have no right to give up the nation’s economic and political rights. These rights must be defended,” he said, in a speech punctuated by cries of “Death to America, Death to Israel” from regime officials at the ceremony.
The European Union and United States on Tuesday warned Iran over its threats to resume some sensitive nuclear fuel work, risking an international crisis.
“I will plead for the suppression of all weapons of mass destruction,” said the new president after the ceremony that was attended by regime leaders and foreign ambassadors.
“As servant of the Iranian nation, I want to defend its independence, our national interests and the religion of Islam. I want to defend the interests of citizens both inside and outside the country,” he said.
Ahmadinejad is the first non-cleric to hold the position since 1981 and is Iran’s sixth president since the revolution.
The former mayor of Tehran was branded by his enemies before his landslide June 24 victory as a dangerous extremist, however he has underlined his promise that there will be “no place for extremism” in his government.
He has indicated that he is ready to work with any country that does not show animosity towards Iran.