Time said the first non-European Pope in 1,200 years is poised to transform a place that measures change by the century.
"The heart is a strong muscle; he's proposing a rigorous exercise plan. And in a very short time, a vast, global, ecumenical audience has shown a hunger to follow him.
"For pulling the papacy out of the palace and into the streets, for committing the world's largest church to confronting its deepest needs and for balancing judgement with mercy, Pope Francis is TIME's 2013 Person of the Year," the magazine's Managing Editor Nancy Gibbs said.
The final 10 contenders for Time's Person of the Year were US President Barack Obama, Syrian President Bashar Assad, Amazon Founder Jeff Bezos, Texas Senator Ted Cruz, pop singer Miley Cyrus, Iranian President Hassan Rouhani, US Secretary of Health and Human Services Kathleen Sebelius and Gay rights activist Edith Windsor.
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BJP's prime ministerial candidate Narendra Modi was among the 42 people shortlisted by Time but he did not make it to the final 10.
Over three million people turned out to see him on Copacabana Beach in Rio de Janeiro last summer and the crowds in St Peter's Square are ecstatic to see him, it said.
Francesco is the most popular male baby name in Italy.