Peter Dutton has been elected leader of the Liberal Party with former environment minister Sussan Ley as his deputy following a leadership meeting in Canberra on Monday.
The former defence minister will lead the party through opposition following its landslide defeat on May 21, where a number of moderate faction MPs lost their seats to so-called "teal" independents.
Chief whip Bert van Manen confirmed the leadership change and thanked former leader Scott Morrison and former treasurer Josh Frydenberg.
"Sadly, Josh couldn't be here given the result in Kooyong, but he's provided [a] tremendous service to the party as a deputy leader and treasurer over the past three-and-a-half years so thank you very much," Mr van Manen said.
Mr Morrison and his factional lieutenant Alex Hawke - who has been criticised for his role in NSW's Liberal preselection saga - were seen attending the party meeting along with soon-to-be-former senator Amanda Stoker.
Former Liberal MP Trent Zimmerman, who lost his inner-city Sydney seat to an independent, earlier warned Mr Dutton must has accept Labor's mandate for climate action or risk an "eternity in opposition".
He framed the incoming leader as a pragmatist who accepts the party cannot reclaim government without speaking to moderate voters.
The party is facing a reckoning after its moderate wing was decimated at the May poll, losing a host of seats to climate and integrity-focused female independents.
And the ascension of Mr Dutton, a conservative with a history of hardline stances on social issues, has raised fears the party could entrench the result long-term.
Mr Zimmerman, who lost North Sydney to independent Kylea Tink, on Monday accepted the new leader had a "hard path ahead of him" to convince voters who walked away from the Coalition.
The pair had many disagreements - over climate, same sex marriage, and refugees - but Mr Zimmerman hoped the new leader's "very strong pragmatic streak" would see him form a constructive opposition.
"I think he is genuine. He's not one of those that saying, like Tony Abbott has, that the seats are beyond the Liberal Party and we should just move on," he told ABC radio.
"I think he knows that we have to regain the trust of voters in electorates like mine if we're going to ever have a pathway to victory."
Mr Zimmerman was part of a now-depleted moderate faction pushing former Mr Morrison to adopt a net zero emissions target by 2050, but the Coalition retained a mid-term target dwarfed by the rest of the developed world.
He said the election result, which also included a Greens surge, gave Labor a mandate to implement its 43 per cent by 2030.
Mr Dutton should be "constructive" over Labor's mandate on climate and an indigenous voice to parliament, he said.
"I think that would be the sensible thing to do. I think it's the democratic thing to do," he said.
"I think it would be an important signal that the Liberal Party has recognised that climate change was a factor in so many seats."