The 49-year-old former navy lawyer led Labor to a crushing victory after eight- and-a-half years in the wilderness.
The party is set to gain up to 21 seats, an astonishing achievement given the fact that it was considered difficult enough to achieve the 10 it needed for an outright majority.
"Today we showed decency and intelligence instead of stupidity and ignorance ... WA showed the way for the rest of the country," he told supporters in a reference to One Nation's poor vote of below five per cent and the Liberals' controversial preference deal with Pauline Hanson.
"The core Australian values of equality, fairness, merit and opportunity shone through this election campaign ... they are Western Australian values and Labor's values."
He said he and his team were committed to providing good government.
"I came here 27 years ago in my Corolla across the Nullabor, and today the people of Western Australia have made me premier. Thank you," he said, shortly after Colin Barnett conceded defeat after two terms.
He also thanked Mr Barnett and his wife Lyn for their years of service to Western Australia.
Mr McGowan entered the Labor victory party on a red carpet with his wife Sarah and children to the strains of AC/DC's TNT, while being mobbed by the party faithful.
He said West Australians deserved good government and his team would not let them down.
Mr McGowan overcame critics within his own party which said he didn't have the x-factor to be premier after Mr Barnett defeated him in 2013, which culminated in a leadership challenge by former federal minister Stephen Smith last year.
He has also won despite not really offering an obvious path out of the record debt and deficit WA is in along with a weak economy, which highlights how unpopular Mr Barnett and his Liberal National government were.
Labor has made $5 billion in promises during the campaign including a near $3 billion ambitious Metronet new rail system.
But Saturday was a night to enjoy victory after so long in the political wilderness.
Mr McGowan said Labor deserved to win, but they would not rest on their laurels.
"Today we have demonstrated our resilience, our tenacity and that when the cause is just we will prevail," he said.
"We will get to work immediately on carrying out our plans."
He said they would govern in the interests of all West Australians.
Senior MP and likely minister Paul Papalia said Labor's message of "jobs for WA locals" has resonated and the Liberal had pretended the widespread anxiety about the state's economic future did not exist until recently.
WA Labor's deputy leader Roger Cook described the win as the greatest in Labor's history given the deficit it overcame.
