His appointment was held up for four days amid political squabbling and over demands he reportedly made about holding elections later than the February date pencilled in.
The presidential statement made no mention of a snap ballot date.
The new government must quickly ratify a critical EU bailout deal to unlock loans that will save Greece from bankruptcy next month.
The irony in chosing Mr Papademos as Greek prime minister to ensure eurozone survival is that he was one of those who eased Greece into the single currency in the first place.
As head of Greece's central bank from 1994-2002, the cautious, quietly spoken technocrat fought rocketing inflation and sought to impose monetary discipline on a country that frankly has never had any.
Along the way, he gathered enough kudos among Europe's leaders and with financial markets to find himself - to his own surprise - appointed as vice president of the European Central Bank, one of the highest international posts ever held by a Greek.
There is little doubt that background, along with a stint at the Federal Reserve Bank of Boston, qualifies him more than perhaps any one else to understand both the economic and international implications of Greece' debt debacle.
He is also a modernist who eschews the kind of nationalistic chest-beating and conspiracy-driven machismo that has so often hurt the country's relations with others.
Others question is whether the quiet academic can handle the rough and tumble of Greek politics, which includes violent street clashes and harsh personal enmities in parliament.
As central bank governor he was widely condemned in the late 1990s for suggesting - rightly as it turns out - that Greece's stock market was a dangerous bubble.