He won 61.8% of the vote, a larger margin of victory than last year.
He vowed to bring Labour back together, saying "we have much more in common than divides us", insisting the party could win the next election as the "engine of progress" in the country.
More than half a million party members, trade unionists and registered supporters voted in the contest.
In a result announced on the eve of Labour's party conference in Liverpool, Mr Corbyn won 313,209 votes, compared with Mr Smith's 193,229.
