The 65-year-old Russian leader took oath at an official ceremony in the Grand Kremlin Palace in the capital, Moscow, on Monday, 18 years after he first came to power.
Putin’s fourth presidential term comes after he easily won the elections in March, receiving 76 percent of the votes.
Communist Party candidate Pavel Grudinin came in second with 11.8 percent, followed by nationalist Vladimir Zhirinovsky with 5.6 percent, according to official results.
“I consider it my duty and sense of my life to do everything for Russia for its present and future – for the peaceful and prosperous future – and the welfare of every Russian family,” Putin said in a speech at the ceremony.
“I can assure you the aim of my life, my work will be as before to serve the people and our motherland,” he added.
Speaking to government members on Sunday, Putin laid down the main challenges and tasks that lie ahead during his next tenure.
“In general, our key task for the next few years is a significant raise of the citizens’ real income,” he said, according to a Kremlin press release.
Putin has proposed Dmitry Medvedev for the post of prime minister, the Kremlin confirmed in a statement on Monday.
A former agent for the Russian spy agency, KGB, Putin went on to become the country’s prime minister in 1999.
Less than five months later, he took over the presidency at the age of 47.
A “macho man” image has fuelled Putin’s popularity at home.
“The things that Russians say they hold Putin in highest esteem for is basically making Russia great again and keeping the country together,” said Al Jazeera’s Rory Challand, reporting from Moscow.
“For many Russians, there is no other leader that they can envision other than Putin.”
The Kremlin leader has worked equally hard to assert Russia’s tough image abroad.
Putin took Crimea from Ukraine – a move that has angered many in the West.
He also stepped in to back the government of President Bashar al-Assad in Syria’s long-running war.
Forbes magazine has named Putin the world’s most powerful person for four years in a row.
On Saturday, thousands of Russians took to the streets to protest Putin’s inauguration under the banner “He’s not our Tsar!” in 90 cities across the country.
The demonstrations were organised by opposition activist Alexey Navalny, who was among 1,600 detained by the police at the anti-Putin rallies. Navalny was later released.