The victory margin is the highest in all the assembly elections in Uttarakhand so far, officials said.
At the end of the last round of counting of votes, Bahuguna won 39,954 votes to beat BJP's Prakash Pant, a former cabinet minister, said Radha Raturi, Chief Electoral Officer.
Sitarganj by-election was held on July 8 to decide the fate of the chief minister, who had to win the election to continue in office.
The by-election was necessitated after BJP MLA Kiran Mandal quit in favour of Bahuguna.
Immediately after the results, Bahuguna thanked the people of Sitarganj for giving him a big victory and said he would now work for development of Uttarakhand, particularly Sitarganj.
The by-election in Sitarganj was marred by allegations of rigging with the state election Office ordering an inquiry by the district magistrate to verify them as the BJP had formally lodged a complaint seeking to cancel nomination of Bahuguna.