Rousseff, 68, was convicted by 61 of the 81 senators of illegally manipulating the national budget. The vote, which exceeded the needed two-thirds majority, meant the veteran leftist leader was immediately removed from office.
Three hours later, Temer -- her center-right former vice president and one time crucial coalition partner whom she now accuses of orchestrating a coup against her -- was sworn in.
Cheers -- and cries of disappointment -- erupted in the blue-carpeted, circular Senate chamber as the impeachment verdict flashed up on the electronic voting screen.
"I will not associate my name with this infamy," read a sign held up by one senator.
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"Coup plotters!" others chanted.
In a surprise twist, a separate vote to bar Rousseff from holding any public office for eight years failed to pass, meaning she could in theory re-enter political life.
Speaking at the Alvorada presidential palace on the outskirts of the capital Brasilia, Rousseff, from the leftist Workers' Party, condemned her forced exit.
"They decided to interrupt the mandate of a president who had committed no crime. They have convicted an innocent person and carried out a parliamentary coup," she said, defiantly vowing that she'd "be back."
A stalwart of the center-right PMDB party, Temer has vowed to steer Brazil away from 13 years of Workers' Party rule in hopes that a more market-friendly track will resolve the country's worst recession in decades.
Rousseff is accused of taking illegal state loans to patch budget holes in 2014, masking the country's problems as it slid into today's economic disarray.
She told the Senate during a marathon 14-hour session on Monday that she is innocent and that abuse of the impeachment process put Brazil's democracy, restored in 1985 after a two-decades-long military dictatorship, at risk.