The Scottish actor, 55, is best known for his role in "The Thick of It," series playing foul-mouthed spin-doctor Malcolm Tucker.
"It's so wonderful not to keep this secret any longer, but it's been so fantastic," he said during the live announcement on the BBC.
This isn't the actor's first turn at a role in "Doctor Who." He played Roman merchant Caecilius in 2008 in "The Fires of Pompeii" episode when David Tennant played the 10th Doctor.
Capaldi also had a role in the five-episode third series of "Doctor Who" spinoff "Torchwood."
Leading up to Sunday's announcement, Capaldi was the bookmaker's favorite to take on the role after weeks of speculation since the 11th Doctor, Matt Smith, announced he was leaving the show in June.
Smith is slotted to appear in the series' 50th anniversary special set to air Nov. 23 and his final turn as the character will be in this year's Christmas special. At that point the character will regenerate and be played by Capaldi.