"The Congress party is my life, the people of India are my life, and I will fight for the people of India and my party, I will fight with everything I have," Gandhi, 42, said in his first speech after being made officially the No.2 in the party.
He also said a "young and impatient India" is demanding a greater voice and role in decision making and more accountability.
In a speech that touched on the ills of a centralized system of government and on the anger and alienation of the youth, who constitute the mass of the country, Gandhi, speaking in Hindi and English alternatively, said the party "does not focus on leadership development".
The party needs to create 40-50 leaders "who can run the country, not just a state" and also create a similar set of leaders at the state level who can be made chief minister.
Gandhi also touched an emotional chord when he related how his mother and party president Sonia Gandhi sat next to him and cried Saturday night, because "she understands that the power many people seek is actually a poison" and she has seen its effect on people and those whom they love.
His grandmother, Indira Gandhi and father Rajiv Gandhi, both prime ministers, fell victim to terrorism.
Outlining the need for the 127-year-old Congress party to develop leadership and give prominence to grassroots workers, Gandhi also asked the party to respect the youths' demand for a greater role in decision-making.
Addressing over 1,200 delegates at the All India Congress Committee session here, he emphasized that the party workers and local leaders need to be respected.
Gandhi, who heads the party's coordination panel, is expected to lead the party in the 2014 general elections. A chorus of voices from the party is demanding he be declared the prime ministerial candidate.
He said the youth was angry and feeling alienated with the existing system.
"Until we start to respect and empower people, we cannot change anything in this country... all are closed systems, designed for mediocrity, mediocrity dominates," he said.
"The job of the Congress is to create leaders for the country," he said, adding that "no other party has so much depth".
Gandhi said his new responsibility was a big one and told party workers that he will treat all of them equally, will learn from their experiences but will only play a judge.
"It is a big responsibility. I will work for everybody from today but I will play the judge and not the lawyer," he said.
He said the time has come to question the "centralised, unaccountable system and decision making must shift from Delhi to the panchayats".
"Why do a handful of people control the entire political space," he asked, adding that "people with little understanding were sitting at high positions".
In a moving speech that won a standing ovation, Gandhi recalled how his mother Sonia Gandhi came to his room and cried Saturday night after the party named him the new vice president.
"Why did she cry?... she understands that the power many people seek is poison...She can see it because of what it does to the people, and the people around, and most important, she is not attached to it (power)," said Gandhi.
"We should not chase power for the attributes of power, we should only use it to empower the voiceless," he added, amid thundering applause of over 1,500 delegates inside the 1,300-capacity Birla Auditorium.
Earlier, the All India Congress Committee endorsed the decision to make him the party vice president.
Rural Development Minister Jairam Ramesh, praising how Rahul Gandhi made the Chintan Shivir into a youth oriented one, said: "What we are seeing in Jaipur is the Congress's Obama moment".
The Bharatiya Janata Party (BJP) however said Rahul Gandhi had spoken "more like a leader of the opposition than a leader of the ruling party."
