Hughton has been rewarded with a contract until the end of the 2010/11 season after guiding the Magpies to the top of the Championship.
At the same time, the club confirmed Barry Moat's takeover bid has fallen through after he failed to match owner Mike Ashley's £80million asking price.
Ashley has now taken Newcastle off the market and will put a further £20m into the club this week as the Magpies push to win promotion back to the top flight at the first attempt.
A statement on the club's official website explained Newcastle's long-term plan - including renaming St James' Park.
It read: "Whilst confirming these two matters, Newcastle United now aims to move forward on and off the pitch.
"The club aims to maximise its commercial revenues; this includes renegotiating its club sponsor and kit deal, which expire at the end of this season, as well as welcoming offers for the stadium naming rights for next season."
DelightedOn Hughton's appointment, managing director Derek Llambias said: "We are delighted that Chris has accepted the post of full-time manager. He has done a terrific job this season and we wish him every success for the rest of this season and beyond.
"He will continue to receive our full backing and support."
Hughton added: "It is a very proud day for me to be named as the manager of this magnificent football club.
"I thank Mike and Derek for their support and 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 never been anything but tremendously supportive to me this season."