The nomination of Kharge, a Dalit leader and a second term member from Gulbarga, was made by Congress President Sonia Gandhi, who has brushed aside demands that either she or her son Rahul take over as leader of the party in the Lok Sabha, who could be recognised as the Leader of the Opposition.
It is the new Speaker's call to recognise the Congress as main opposition group so that its leader can get the status of Leader of the Opposition as the party does not have 55 MPs, ten per cent of the total strength, to earn the status.
"Congress President Sonia Gandhi has nominated Mallikarjun Kharge, as the Leader of the party in Lok Sabha," party General Secretary in charge of Organisation Janardan Dwivedi announced in the evening.
The decision eliminates Kamal Nath, the senior-most member of the Lok Sabha, who has been elected for a ninth term in the House, and M Veerappa Moily, another former Chief Minister from Karnataka from the leadership race now.
The nomination of a Gandhi-Nehru family loyalist brings to an end the intense speculation going on for over a fortnight about who will hold this crucial position at a time when the party is smarting under it worst-ever defeat.
Kharge, a low-profile leader, was Railway Minister in UPA II and represents the has been elected from Gulbarga for a second time in the recent elections.
He was elected to the Karnataka Assembly 9 times and had functioned as the Leader of the Opposition there.
Besides his seniority, the fact that Karnataka has sent the largest contingent of nine MPs for Congress in this Lok Sabha polls, also seems to have gone in his favour.
There were different views in the party on who should lead the pack of 44 MPs in the Lok Sabha. While a number of leaders were of the firm opinion that either Sonia Gandhi or Rahul should take up the responsibility, there was also a section which was propping up the name of senior-most party MP Kamal Nath.
Echoing the view in some sections of the party that either of the Gandhis should take the mantle of leadership in Lok Sabha, former Union Minister Shashi Tharoor had said a couple of days back that the political leadership of the party has to be its face to the nation as well.
While a number of senior leaders wanted Sonia to take over as the Leader of Opposition, the leaders mentored and given responsibilities by the Congress Vice President want him to lead the pack.
Their argument was that it was Rahul, who was the face of the party in the Lok Sabha polls, and should not "shy away" from taking responsibility in difficult times for the party.
There was a view that if Sonia does not become the Leader of the party in Lower House, then Rahul should assume the role.
Leaders have been saying in private that the party should not be sending confusing signals among party workers and the voters as to where the leadership of Congress lies.