Lawmakers voted 59 to 42 to approve him as prime minister.
The leader of the Armenian opposition faction Yelk, leader of protests, Nikol Pashinyan, was the only candidate nominated by the Yelk, Tsarukyan Bloc and Dashnaktsutyun factions for the second round of the voting.
Former Prime Minister Serzh Sargsyan was forced to resign in April in response to a series of protests triggered by his appointment as prime minister, after he had already served as president for a decade.
The first vote in Parliament took place on 1 may.
"I am 95 percent sure that your candidate will be elected as prime minister tomorrow", Pashinan told the cheering crowd.
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Although Armenian leaders traditionally visit the region on May 9, the date on which many ex-Soviet countries mark the defeat of Nazi Germany, Pashinian's trip is likely to provoke resentment from Azerbaijan.
"I am in a working mood, there is no sense of euphoria, just work to do", Mr. Pashinyan said. Mr Pashinyan and other activists brought out tens of thousands of people on to the streets for protests that paralysed the capital, Yerevan.
Pashinyan, who was one of the main supporters of Ter-Petrosian, became a target for political presecutions and was forced to spend nearly 1.5 years "underground". "However, if it turns out that they are ineffective, they will be discontinued", he said. He later called off the demonstrations after the ruling party assured him of its support in his bid for prime minister. The Republican Party allied with Sarksyan still retains its parliamentary majority. "You can absolutely compare him with historical figures like Gandhi and Nelson Mandela", said Eduard Aghajanyan, a city council member from Mr Pashinyan's Civil Contract party, and one of Mr Pashinyan's young, western-educated advisers.
Protesters accused Sargsyan of attempting a power grab under a new parliamentary system of government passed in a 2015 referendum that the opposition says was tainted by irregularities. Within 20 days after forming the cabinet, the prime minister is to submit the government's action plan to the parliament for approval.
Critics accuse Sarkisian and his Republicans of corruption and failure to tackle widespread poverty and the influence of powerful oligarchs in the tiny South Caucasus nation of 2.9 million people.