The 50-year-old had been in caretaker charge for the opening weeks of the new season, helping the Magpies to the top of the Championship.
Hughton told the club's official website: "It's a very proud day for me to be named as the manager of this magnificent football club.
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"I will be doing everything in my power to get the club back into the Premier League at the first time of asking.
"Having the unequivocal backing of the players has helped me enormously and I would also like to thank Colin Calderwood, Paul Barron and the rest of the backroom staff who have been tremendously supportive to me this season."
Meanwhile, owner Mike Ashley has taken the club off the market and pledged to invest more money at St James' Park.A short statement confirmed:
"Mike Ashley is totally committed to the future success of Newcastle United and will be focused on gaining promotion back to the Premier League."He will put a further £20million into the club this week."