The sentence capped a stunning fall from grace for the Illinois Democrat who was once a rising national star but resigned under a cloud in November after 17 years in the House of Representatives.
Jackson, 48, apologized in court under the watchful gaze of his parents and other loved ones.
"I take responsibility for my actions," he told the judge.
"I let a lot of people down... I misled the people, the Congress, the media."
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Prosecutors said Jackson used some of the siphoned funds to buy personal items ranging from fur capes and collectibles to movie tickets and groceries and even a USD 43,350 gold-plated Rolex watch.
"Jesse Jackson Jr's journey from the halls of Congress to federal prison is a tragedy of his own making," said US Attorney Ronald Machen.
"Jackson's political potential was unlimited, but he instead chose to treat his campaign account as a personal slush fund, stealing from the people who believed in him so he could live extravagantly."
The judge permitted the couple to stagger their prison time in order to ensure at least one parent is always on hand to care for their young children.
Jackson took a leave of absence from Congress last June to receive treatment for bipolar disorder and related depression, and for two months his whereabouts and condition were a mystery.
"Jesse has been very sick," his father told reporters. "This time a year ago I thought that we lost him. I think that he is strong enough now to accept the challenges put before him by the judge."
Blagojevich was impeached and then jailed for bribery, but Jackson was never charged with any wrongdoing related to the scandal. However, prosecutors continued to dog his steps and discovered the diverted funds.
Jackson was first elected to Congress in 1995 after having worked with his father's Rainbow PUSH Coalition.
Easily reelected in his largely Democratic Chicago district last November, Jackson resigned 16 days later, citing his health problems while also acknowledging the ethics investigations.
Jackson had faced up to five years in prison on charges of conspiracy, making false statements, and mail and wire fraud.