Leo, the former Cardinal Robert Prevost and the first US pope, looked calm as he delivered the mass in the frescoed chapel with the same cardinals who chose him to be the 267th pontiff and the successor to Pope Francis.
Leo, 69, who was born in Chicago but spent two decades as a missionary in Peru, said a few words in English before continuing his homily in fluent Italian.
He painted the spiritual picture of the church he would like to see under his papacy.
"God has .... entrusted this treasure to me so that, with his help, I may be its faithful administrator for the sake of the entire mystical Body of the Church," he said on Friday.
"He has done so in order that she may be ever more fully a city set on a hill, an ark of salvation sailing through the waters of history and a beacon that illumines the dark nights of this world."
The 1.4 billion-member church was great not because of "the magnificence of her structures or the grandeur of her buildings ... but rather through the holiness of her members", he said.
An inauguration mass for Leo will be held in St Peter's Square on May 18, with world and religious leaders invited to attend.
Pope Francis's inauguration in 2013 attracted a crowd estimated at 200,000 people.
Senior Vatican officials will be left in their roles for the time being, giving Leo time to decide on definitive appointments.
The Pope was elected at the end of a two-day conclave that end on Thursday evening when white smoke billowed from the chimney on the Sistine Chapel.
Given the nature of the conclaves, when cardinals are shut away from the world and sworn to secrecy, little or nothing is likely to emerge about how Leo obtained the required two-thirds majority of the vote so swiftly.
The successor to Pope Francis, who died in April at age 88, inherits a number of major challenges, ranging from a budget shortfall to divisions over whether the church should be more welcoming towards the LGBTQI community and divorcees, and should let women play a greater role in its affairs.
Before Leo's election, US cardinals had largely been written off as papal contenders because of a widespread assumption that the global church could not be run by a superpower pope.
However, he also holds Peruvian citizenship, meaning he has deep knowledge of both the West and less developed nations.
US President Donald Trump was quick to congratulate Leo.
However, the new pope has a history of criticising Trump and Vice-President JD Vance's policies, according to posts on the X account of Robert Prevost.
Leo worked for decades in the north of Peru, first as a missionary and later as bishop of Chiclayo from 2015 to 2023.
One of the clues to what kind of a church leader Leo will be was in his choice of name.
The last pope with this name was Leo XIII, who led the church from 1878 to 1903 and was known for his focus to social justice issues.
Prevost became a cardinal only in 2023. Francis brought him to Rome two years ago to head the Vatican office in charge of choosing which priests should serve as Catholic bishops.
