Labour's Stewart Young, from Carlisle, has been elected as the new leader of Cumbria County Council.
His party won the most seats at the recent county council elections and will run the council in coalition with the Liberal Democrats.
Liberal Democrat Jo Stephenson, from Windermere, has been elected deputy leader.
For the previous four years the Conservatives were the biggest party on the county council and were in coalition with Labour, but Labour became the biggest party at this month's elections.
"Clearly the financial crisis is looming over everything else and we need to tackle that and we will tackle that but I think as well as that we need to invest in the county.
"There's a desperate need to bring additional jobs."
James Airey, from Ulverston, will be the Conservative and opposition leader.
The Conservatives say they fear that rural areas will lose out under the new administration.