Justice Minister Emmerson Mnangagwa, was appointed as the senior of the two deputies during a televised ceremony. They replaced Joice Mujuru, who was fired earlier this week after she was booted from the ruling ZANU-PF party.
Mugabe accused Mujuru and her allies, who were also fired, of plotting his assassination.
Mnangagwa kneeled before the 90-year-old Mugabe and his wife, Grace Mugabe, in a show of gratitude when his appointment was announced on Wednesday.
"He is the man Mugabe can trust, not just with securing his family's business but with maintaining a hardline stance as well," said Gabriel Shumba, a human rights advocate and political analyst.
The two men fell out for a while when Mugabe accused Mnangagwa of plotting a coup and demoting him to a junior cabinet post in 2004. Mnangagwa's allies in the ZANU-PF party were also ousted in a purge similar to that suffered recently by Mujuru and her supporters.
The second vice president, Phelekezela Mphoko, was previously a diplomat.
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