The DPP chairmanship fell vacant following the resignation of Yu Shyi-kun last month after he was indicted on corruption charges in September.
Chen has been pressing for formal independence for Taiwan, rejecting calls for direct trade and transportation links with Beijing, arguing they could lead to eventual political integration.
He vowed to continue pushing for a referendum on seeking UN membership – the latest of which was rejected in September – under the name Taiwan, and renewed a pledge to hold the vote simultaneously with the presidential election in March.
In contrast, Frank Hsieh, the DPP's candidate in the presidential poll, takes a much softer line toward China in the hope of gaining strong support from the island's broad majority of moderate voters.
Hsieh is running against Ma Ying-jeou of the main opposition Nationalist party.
Taiwan split from China amid civil war in 1949, but Beijing continues to claim the island as part of its territory, threatening to attack if the "renegade province" declares formal independence.