Alan Johnson has been appointed to the key role of shadow chancellor in Ed Miliband's first shadow cabinet.
Ed Balls is shadow home secretary while his wife Yvette Cooper - who topped the ballot of Labour MPs for the shadow cabinet - is shadow foreign secretary.
Both had been tipped for the economic portfolio shadowing Chancellor George Osborne.
Mr Miliband said: "I am delighted with my new shadow cabinet, drawn from a broad range of talents across our party. My team is united in one central mission for the future - to win back the trust of the British people and take Labour back to power.
"Together, this new generation of Labour will work together to reject the pessimism of this coalition Government as we set out our vision of what Britain can achieve. Our values are those of the British people, and this shadow cabinet will ensure that the hopes and concerns of working families are at the heart of our offer to the country."
Other key appointments were another defeated leadership candidate Andy Burnham as shadow education secretary, Jim Murphy as shadow defence secretary and deputy leader Harriet Harman as shadow international development secretary.
Sadiq Khan, who was Mr Miliband's campaign manager in the leadership election, is rewarded with the plum post of shadow Lord Chancellor and justice secretary. He will also be responsible for shadowing Deputy Prime Minister Nick Clegg over his constitutional and political reform programme.
Peter Hain and Shaun Woodward, who both failed to secure election to the shadow cabinet, nevertheless carry on shadowing Wales and Northern Ireland respectively, as discretionary appointments of the leader. Mary Creagh is the new shadow environment secretary, Ann McKechin is shadow Scottish secretary, while Tessa Jowell carries on as shadow Olympics minister.
Mr Johnson said: "Since his election as leader, Ed has demonstrated real strength of character and determination to unify and lead. We are both passionate about a new kind of politics where we will not disagree with our political opponents for the sake of it. These are testing times and we will be a responsible opposition acting in the national interest."
He added: "Ed and I will work together to build a plan for growth and for jobs in our economy. We will offer a real and responsible alternative to the dangerous plans of this coalition Government which is damaging the economic future of millions of families. I relish the challenge this post brings and look forward to working with this strong and unified new shadow cabinet team."