Supreme Court judge Elena Kagan administered the oath of office to Kerry during a private ceremony on Capitol Hill. He was joined by his wife Teresa, daughter Vanessa, brother Cameron and his Senate staff.
But a pall was cast over the historic events by an attack on the US embassy in Ankara that killed a local Turkish security guard.
It came less than five months after the September attack on the US outpost in Benghazi, Libya, in which ambassador Chris Stevens and three other Americans died, and two weeks after the militant hostage crisis in Algeria.
“I am very proud of the work we have done together,” Clinton, 65, told hundreds of cheering staff just before she left the State Department, having tendered her letter of resignation to President Barack Obama.
“Of course, we live in very complex and even dangerous times, as we saw again just today at our embassy in Ankara, where we were attacked and lost one of our foreign service nationals, and others injured.
“I know that the world we are trying to help bring into being in the 21st century will have many difficult days,” she added.
But the former first lady and New York senator said she was “more optimistic today than I was when I stood here four years ago” because of the agency’s work to help ensure “peace, progress and prosperity” around the world.
US officials said they were probing the Ankara attack, when a bomber wearing a suicide vest blew himself up at the first checkpoint on the perimeter of the embassy compound. Three people were hurt, including one seriously.
The bombing once again exposes the vulnerability of the army of 70,000 US diplomats — many of whom operate in the world’s hotspots.
Kerry told The Boston Globe he would begin working on diplomatic protection when he starts at 9:00 am (1400 GMT) Monday, and in a seamless transition, his picture and biography were already gracing the State Department’s website.
“There are certain things I intend to issue instructions on, the minute I come in,” Kerry told the leading daily paper in his home state of Massachusetts, where he served as senator for 28 years.
“I won’t go into the details, but Benghazi, embassy security, issues regarding some of the analysis that I want to track with respect to Iran, with respect to Syria. Trouble spots.”
Kerry also pointed to a “major meeting on Syria in the next few days,” although it was not immediately clear whether he was just referring to talks being held at the Munich Security Conference.
“I hereby resign as 67th secretary of state,” Clinton told Obama in her letter, adding she was “proud of what we have accomplished together on behalf of the American people and in pursuit of our interests and values.”
She steps down with record popularity ratings of around 65 percent, and amid intense speculation that she could launch a second bid to be the nation’s first woman president in the 2016 elections.
But so far, Clinton has said she doesn’t see herself returning to politics, insisting instead that she wants to work on advocacy and philanthropy and continue “the cause of my life,” furthering the rights of women and girls.
Political analysts, however, say she could be the Democratic Party’s best hope in four more years, and she would have good odds of breaking through that last glass ceiling.
“She is (a) more admired, less polarizing figure than she was in 2008,” Democratic strategist Geoff Garin told National Public Radio.
“The political prospects are really quite good, and better than they were when she last ran for president.”
Kerry, meanwhile, revealed he would make his first foreign trip this month, but said he had no plans to beat Clinton’s record of visiting 112 countries.
He also said Obama had asked him to replace Clinton a full week before US Ambassador to the United Nations Susan Rice pulled out of the race.
Rice, who had been thought to be Obama’s first choice for the post, had come under Republican fire for comments she made during the Benghazi maelstrom.