The event officially puts in place the power-sharing government agreed upon by President Kibaki and Mr. Odinga in an agreement mediated by former U.N. Secretary General Kofi Annan in late February.
Mr. Annan was on hand for the event and urged support for the new government, despite concerns that the large number of ministers, the most in Kenya's history, is a waste of resources.
"I know there has been some debate as to the size of the government, but what is important is that we do have a government," he said. "We have an opportunity to put Kenya back on track and build a stronger Kenya and it is essential that you all support the leaders and the government."
Ugandan president Yoweri Museveni, Prime Minister Odinga, and President Kibaki also delivered speeches. The president sounded an optimistic note on moving forward.
"The recent general elections seriously divided our people along regional and ethnic lines. The formation of the grand coalition government promises to heal the rifts created by negative politics and ethnic suspicions which threatened to tear our nation apart," said Mr. Museveni.
Some analysts say the president's party has maintained a larger share of key offices, including defense, foreign affairs, internal security, finance and justice. Orange Democratic Movement members will be running the land, agriculture and local government ministries, among others.
There is concern about how long the government will last because the relative powers of the president and prime minister have not been spelled out, leaving the door open for future conflict.
But the executive director of the Kenya chapter of the International Commission of Jurists, George Kegoro, says there is little advantage for the two sides in abandoning the current arrangement anytime soon.
"They have come from very expensive elections. They would like to re-group across the board. And they would like also to re-arm politically. None of the groups is ready for battle again, which is what walking away from the alliance would invite," he said.
The cabinet will be charged with the resettlement of hundreds of thousands of people displaced by the post-election violence and putting the country's economy back on track.
At the center of the government's agenda will be an overhaul of the country's constitution. That was the issue that split the previous government, causing Mr. Odinga to break with the president and form what would become the Orange Democratic Movement.