Russian President Dmitry Medvedev appointed three of Vladimir Putin's closest aides to run his Administration, ensuring Mr Putin retains his strong grip on power despite leaving the Kremlin.
Mr Putin, who moves to become Prime Minister, also announced a Cabinet which combined key ministers and powerful figures into what analysts said was an unusually strong team.
Mr Medvedev and Mr Putin have pledged to rule Russia together in an unprecedented "tandem" arrangement. But many analysts said the appointments confirmed that Mr Putin remains the real boss, at least for now.
Key Mr Putin ally Sergei Naryshkin - a former government chief of staff reported by Russian media to have links to the security services - was named head of Mr Medvedev's Kremlin Administration, while one of Mr Putin's main ideologues Vladislav Surkov becomes the first deputy chief of staff.
"I don't think the appointment of Sergei Naryshkin as head of the presidential Administration is the decision of Dmitry Medvedev," said independent political analyst Georgy Bovt.
"I think it is the decision of Vladimir Putin and I don't actually see any appointments apart from (new Justice Minister Alexander) Konovalov that you can put down exclusively to Dmitry Medvedev."
Mr Surkov is credited with partly formulating Russia's "sovereign democracy" system of government which some observers say is autocratic and Mr Medvedev has criticised in the past. Alexei Gromov, Mr Putin's former press secretary, will also stay in the Kremlin as deputy chief of the presidential staff.
Mr Putin re-appointed his long-serving Finance Minister, Alexei Kudrin, seen by markets as a guarantor of Russia's free-market policies. Sergei Lavrov, the public face of Moscow's assertive, anti-Western diplomacy, also stayed on as foreign minister.
"While planning the optimisation of federal executive authorities, we aimed to increase the efficiency of the state machinery and its personnel," Mr Putin told reporters as he announced his nominations.
Two key figures from the all-powerful Kremlin administration moved with Mr Putin to take up new roles in the White House, the riverside seat of Russia's government.
Sergei Sobyanin, a former governor of the oil-rich region of Tyumen who headed the Kremlin Administration under Mr Putin, becomes the new premier's chief of staff and one of five deputy prime ministers.
Igor Sechin, formerly a deputy head of the presidential Administration and a key Kremlin hardliner with close ties to the security services, becomes another of the five deputy Prime Ministers, tasked with overseeing industry and energy.
Analysts said the combination of key Kremlin figures and influential serving ministers made Putin's administration unusually strong. Under Russia's 1993 constitution, Presidents have dominated with prime ministers usually being weak figures.
State-controlled oil major Rosneft strongly outperformed the stock market, with gains of 4.5 per cent, in a performance which underlined the close ties between the Kremlin and business.
Traders attributed the rise to the promotions of Mr Sechin and Mr Naryshkin, who were also Rosneft chairman and deputy chairman respectively.
Former prime minister and ex-collective farm boss Viktor Zubkov continued in the Cabinet as one of two first deputy Prime Ministers - the most senior posts after Mr Putin's. The other was Igor Shuvalov, who was Putin's top economic aide at the Kremlin.
"Overall, there are no surprises," said Yevgeny Gavrilenkov, chief economist at Moscow brokerage Troika Dialog.
"It is no doubt a positive sign that Mr Kudrin, known for his conservative policies, has stayed ... It is logical that people who worked with Putin in the presidential administration moved to the government."
Among the few major changes were the removal of Telecoms Minister Leonid Reiman, who has repeatedly denied media reports that he indirectly owns a major stake in Russia's number three mobile operator Megafon.
Mr Medvedev's other two key appointments were the naming of former FSB spy service chief Nikolai Patrushev, a Mr Putin ally, to run Russia's powerful Security Council and the promotion of FSB deputy chief Alexander Bortnikov to replace Mr Patrushev.
Mr Bortnikov was previously head of the FSB in Mr Putin's home city of St Petersburg.
Under Russia's Constitution, the Prime Minister proposes Cabinet names to the President, who must approve them before they are final.
Russia's top officials: Who does what?
Following are brief descriptions of the figures named so far to key Kremlin and government posts:
Kremlin Chief of Staff: Sergei Naryshkin, 53, was born in Leningrad (now St Petersburg). Educated as an engineer and radio mechanic before studying economics. Worked as economic adviser to the Soviet embassy in Belgium in the 1980s and later in the St Petersburg mayor's office. Deputy chairman of state oil giant Rosneft and chairman of Channel One state television. Chief of government staff since 2004. Speaks English and French. Some Russian and international reports have linked him to the KGB but this has never been officially confirmed.
First deputy Prime Ministers: Viktor Zubkov, 66, is a former Soviet collective farm boss, Mr Zubkov served as Putin's last Prime Minister. A close Putin associate, Mr Zubkov is on the list of candidates to chair Gazprom, Russia's state-controlled gas giant. Igor Shuvalov, 41, is lawyer by education, and a former government chief of staff who worked as the top Kremlin economic adviser to Mr Putin from 2003. He was Russia's sherpa to the Group of Eight industrialised nations.
Government chief of staff: Sergei Sobyanin, also deputy Prime Minister, 49, worked as Mr Putin's Kremlin chief of staff since 2005. Educated as a lawyer, Mr Sobyanin was governor of the Tyumen region, one of Russia's richest oil-producing areas, before being made chief of staff by Mr Putin. Known for his ability to find compromises between Russia's powerful oil barons and keep governors in order. He headed Mr Medvedev's election campaign.
Finance Minister: Alexei Kudrin, also Deputy Prime Minister, 47, worked as Russia's Finance Minister from May 2000. He has turned around Russia's finances, balancing the budget after the chaos of the 1990s and defending windfall oil revenues from elements in the government who want to spend the cash. He has become the darling of emerging market bond investors for supporting market reforms and tight fiscal policies. Helped Mr Putin land his first job in the Kremlin.
Deputy Prime Ministers: Sergei Sobyanin, Alexei Kudrin, Igor Sechin,47, Kremlin joint deputy chief of staff since 2000. One of Mr Putin's closest advisers since his days in St Petersburg. Chairman of state-controlled oil giant Rosneft. Often reported to have a security service past, though this has never been officially confirmed. Considered the informal head of the Kremlin hardliners' camp. Sergei Ivanov, 55, worked as first deputy Prime Minister in the previous government. He was considered one of the two front-runners to succeed Mr Putin as president. A former Soviet career spy who was posted to top posts in Europe and Africa. Very close ties with Mr Putin. Influence over security services, defence and arms industry. Alexander Zhukov, 51, a respected former parliamentarian, Mr Zhukov is an economist who was named a first deputy Prime Minister in 2003. A year later he was named deputy Prime Minister. He is in charge of Russian preparations for the 2014 Winter Olympics in Sochi.
Federal security service chief: Alexander Bortnikov, 56. The FSB is the main successor to the Soviet KGB and wields immense influence in Russia. Mr Bortnikov was appointed head of the FSB's economic security department in 2004 and then became deputy FSB chief. Previously he was head of the FSB in St Petersburg.
Security council secretary: Nikolai Patrushev, 56, headed the Federal Security Service under Mr Putin since 1999. Mr Patrushev has close ties with Mr Putin, a former KGB spy, and with Mr Sechin. Another key member of the hardline camp.
Foreign Minister: Sergei Lavrov, 58, a career diplomat, Mr Lavrov has served as Russia's foreign minister throughout Vladimir Putin's second term as president, since March 2004. He has closely echoed in public Mr Putin's assertive comments towards the west on issues like Nato enlargement and independence for Kosovo.
Other ministers: Anatoly Serdyukov, Defence Minister (re-appointed) Viktor Khristenko, Industry and Trade Minister (previously Energy and Industries Minister) Sergei Shmatko, Energy Minister Elvira Nabiullina, Economy Minister (re-appointed) Alexander Konovalov, Justice Minister Alexei Gordeyev, Agriculture Minister (re-appointed) Igor Shchyogolev, Communications Minister Dmitry Kozak, Regional Development Minister (re-appointed) Rashid Nurgaliyev, Interior Minister (re-appointed) Andrei Fursenko, Education Minister (re-appointed) Yury Trutnev, Natural Resources Minister (re-appointed) Sergei Shoigu, Emergency Situations Minister (re-appointed) Tatyana Golikova, Health Minister (re-appointed) Igor Levitin, Transport Minister (re-appointed) Alexander Avdeyev, Culture Minister Vitaly Mutko, Minister of Sport, Youth and Tourism.