Gillard said the leadership had been settled in "the most conclusive fashion possible" and that the "whole business is completely at an end".
"I'm grateful to my colleagues for their continuing support ... [and] I accept their continuing support of me as Prime Minister and Labor leader with a sense of deep humility and a sense of resolve," she said.
"I never sought office for its own sake. I have only ever sought office in the interests of the nation."
This is her third victory over Rudd, having forced him from the job after a 2010 coup and defeated him decisively in a challenge in February last year.
But there is still no certainty Rudd supporters will accept yesterday's outcome.
Polling has consistently shown that he is a more popular leader than Gillard, and that support for Labor would increase to within striking range of the Opposition with him as prime minister.
Rudd did not have the numbers he needed for a decisive, overwhelming victory - a key condition for any new tilt at the leadership - and his backers might decide to continue in the hope of forcing another, successful, bid.
Time is running out, however, and any late move would effectively destroy whatever chance Labor has of retaining power.
Gillard will also have to convince sceptical voters - many of them still deeply resentful of her political assassination of Rudd - that Labor is finally a united and effective Government.
Her immediate survival yesterday was ensured when Rudd told reporters outside the caucus room that he intended to honour his word not to stand against Gillard.
"I believe in honouring my word," he said.
"Others take such commitments lightly. I do not.
"Secondly, I have also said that the only circumstances under which I would consider a return to leadership would be if there was an overwhelming majority of the parliamentary party requesting such a return, drafting me to return, and the position was vacant.
"I am here to inform you that those circumstances do not exist.
"Therefore ... I will be adhering absolutely to the commitment that I gave the Australian people and to my parliamentary colleagues."
Yesterday's spill was forced by the defection of key supporter Simon Crean, a former Labor leader and present Arts Minister.
In a dramatic media conference earlier in the day Crean revealed that he had urged Gillard to declare a spill of all leadership positions or face a demand from MPs under caucus rules that would have forced her to comply.
Although considered as a compromise third candidate, Crean conceded he did not have the numbers and would stand only for the job as deputy leader under Rudd, whom he now supported.
He said that Labor could not win the election from its present position in the polls, but that its problems were not confined to the leadership.
"Our problem is more fundamental, it's getting back to what the Labor Party not just stands for but how it advances the interests of the nation," Crean said.
Crean was later dumped from the Cabinet.
Gillard agreed to the spill in a bid to end instability and relentless leadership speculation triggered by leaks and rumours from Rudd supporters, a series of policy blunders and scandals, and disastrous polling.
A key media reform package, with the exception of two bills, was yesterday withdrawn by the Government after disastrous tactics ensured its defeat in Parliament.
Gillard cut short question time yesterday after announcing the spill and telling Opposition leader Tony Abbott to "take your best shot".
A vote of no confidence proposed by Abbott failed.
"This is a Government which has lost its way," Abbott said.
"For our country's good, you should go."
Labor will now have to focus all its energies on September in a bid to reverse an exodus of Labor voters.
Gillard called the long election campaign in a bid to regain the political agenda, refocus attention on her legislative programme, and redirect the heat to Abbott.
Whether leadership rumblings will now subside and allow the party to circle wagons around the nation's first female Prime Minister is now crucial.
