Koizumi's second term became a certainty after his ruling coalition won a stable although reduced majority in a 9 November election for parliament's Lower House.
Koizumi, who leads the Liberal Democratic Party (LDP), repeatedly bowed to applause from supporters after garnering 281 votes out of a total of 479 ballots cast in the 480-seat House of Representatives which convened for a nine-day special session.
The LDP controls 245 seats in the all-powerful lower chamber and its coalition partner, New Komei Party, has 34.
Shortly before his re-election, Koizumi told a gathering of LDP lawmakers he would press on with his reform agenda, which covers a range of issues from the overhaul of the economy to welfare and pension schemes.
"We face a difficult situation with tasks piling up, but I will do my utmost efforts to promote reforms," he said.
"We face a difficult situation with tasks piling up, but I will do my utmost to promote reforms"
Topping Koizumi's agenda is the question of when to dispatch troops to Iraq, whose worsening security situation has prompted his government to back-pedal on a plan to send an advance team.
Opinion polls have shown a large majority of the Japanese public is opposed to sending troops to Iraq. A weekend telephone survey by the private Nippon Television network found 71% are opposed to the deployment.
In July, the ruling coalition pushed a controversial bill through parliament, allowing the first dispatch of troops since World War II to a country where fighting continues.
The political opposition, which is against sending troops, controls 180 seats including three independents who joined the DPJ-led parliamentary group. Among them is former Koizumi ally and foreign minister, Makiko Tanaka.
Pressure to perform
Koizumi - who took office in April 2001 promising to cut pork-barrel spending, privatise wasteful public corporations and fix ailing banks - could become Japan's longest ruling prime minister in two decades if he completes a fresh three-year term as president of his Liberal Democratic Party begun in September.
The prime minister, who is expected to reappoint all his cabinet ministers following his own re-election, is under pressure from many voters, media and the Democrats to make real progress on his reform agenda.
Along with the Iraq troop dispatch, reform of a pension system straining under an ageing population looms large.