An official tally of 99.66 percent of ballots showed Rousseff with 51.60 percent of valid votes and Neves with 48.40 percent.
In a victory speech shortly after in Brasilia, Rousseff said she hoped to be a better president in her second term and said she was determined to undertake reforms and changes that the Brazilian society demands. Neves conceded defeated to Rousseff in a speech to his supporters.
Opinion polls before the results were announced gave Rousseff a four-percent to six-percent lead, although Sunday’s election remained too close to call until the last minute.
Rousseff will face a declining economy in recession and rising inflation which has broken the government’s own target ceiling of 6.5 percent.
Rousseff will also have to deal with public frustration over shoddy public services and endemic corruption.
Brazil’s most competitive presidential campaign in decades has also been the most acrimonious in recent memory, dominated by attack ads and a steady drum beat of corruption allegations.
The bitter campaign has emphasized a clash between classes in a country still riven by inequality. Rousseff’s team relentlessly portrayed Neves, a third-generation politician, as a heartless playboy with little concern for the poor.
Rousseff led the first round earlier in October with 41.5 percent compared to 33.6 percent for Neves. Prominent environmentalist Marina Silva was in third place with just 21 percent of the votes.
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