His rise comes at a crucial time for Saudi Arabia which is in a battle for regional influence with arch-rival Iran, bogged down in a controversial military intervention in neighbouring Yemen and at loggerheads with fellow US Gulf ally Qatar.
He is the main champion of the kingdom's Vision 2030 reform plan to bring social and economic change to the oil- dependent economy of a country where women's rights are among the most restricted in the world.
The United Arab Emirates' most-powerful leaders have welcomed Saudi Arabia's new crown prince. Like numerous youth of the country - among whom he is very popular - he is dynamic and impatient for change. That visit to Washington helped lay the foundation for Trump's visit to Saudi Arabia in May, which marked the president's first overseas visit and which was promoted heavily by the kingdom as proof of its weight in the region and wider Muslim world.
Saudi television channels showed the bearded Mohammed bin Salman kissing the hand of his ousted cousin Mohammed bin Nayef and kneeling in front of the older prince, who patted his shoulder to congratulate him. He retains the defence, oil and economy portfolios.
Saudi King Salman has issued an order for high-ranking royals to pledge their allegiance to his son, 31-year-old Mohammed bin Salman, at a ceremony in Mecca.
The competition and struggle for the throne between Mohammed bin Salman bin Abdulaziz and Mohammed bin Nayef began in 2015. Prince Mohammed bin Salman replied: "We will not give up taking your guidance and advice".
Analysts said the change ends uncertainty over succession and empowers Prince Mohammed bin Salman to move faster with his plan to reduce the kingdom's dependence on oil, which includes the partial privatisation of state oil company Aramco. "Prince Mohammed bin Salman (MbS) is its architect", said John Sfakianakis, director of the Gulf Research Centre. "There's no question as to who's going to be in charge". And he was widely thought to have been the driving force behind the reduction in powers of Saudi Arabia's religious police previous year - the Haia, as the force is known informally in the kingdom, are now no longer allowed to arrest people or demand their IDs.
"Some people were predicting that this would lead to a division in the family and strife and some kind of revolt".
Scottish independence dealt a blow
Sturgeon vowed to reflect, listen and consider the way forward after the SNP lost 21 seats in parliament in the general election. At the time of writing it has won 34 of Scotland's seats, down from 56, and 37% of the vote, versus almost 50% last time around.
The newly-minted crown prince also raised eyebrows when he ruled out any chance of dialogue with Iran.
Although no reason was stated for the huge government reshuffle, but it could be seen as a reward for the young prince who met with the U.S. President Donald Trump at the White House in March, which was recognized as a success to Saudi Arabia.
Here are three key areas to watch as the prince becomes first in line to the most powerful throne in the Middle East. The position is relatively new in Saudi Arabia, where kings have traditionally chosen their own successors.
The warm ties forged between Riyadh and Washington under the Trump administration may have helped accelerate Mohammed bin Salman's ascension as crown prince.
It also appointed young princes from other branches of the family to government roles, seemingly to reassure them that they will remain part of the ruling structure.
The decision by King Salman to promote his son and consolidate his power was endorsed by 31 out of 34 members of the Allegiance Council, made up of senior members of the ruling Al Saud family, the royal decree said.
He is now defence minister, giving him command of one of the world's biggest arms budgets and making him ultimately responsible for Saudi Arabia's military adventure in Yemen.
The Saudi stock market rose four percent on news that the king had named him as crown prince and that the exchange had moved closer to joining a major global index.
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