Other appointments included former Prime Minister Alain Juppe, in charge of the environment — an area Sarkozy says is a priority — and Jean-Louis Borloo as minister for the economy.
The Cabinet, trimmed to 15 ministers, offered both youth and experience, and near-equal distribution among the sexes. Former Defense Minister Michele Alliot-Marie was named as interior minister, and Sarkozy campaign adviser Rachita Dati will head the Justice Ministry.
Sarkozy had promised a new ministry for immigration and national identity, a top focus on environmental issues and near-gender equality — all while paring the Cabinet down from 16 full ministers and 15 junior ministers under his predecessor, Jacques Chirac.
The shake-up included spliting the former education ministry in two, with the creation of a full ministry for research and higher education. The sports and health ministries were fused. Ministries for tourism and French overseas territories were either scrapped or meshed under other posts.
The president named longtime friend Brice Hortefeux to lead the new Ministry of Immigration, Integration and National Identity — aimed at helping unite a country with rising ethnic diversity and tensions.
Perhaps the biggest surprise in the conservative-led government was left-wing Kouchner, a co-founder of the Nobel Prize-winning Doctors Without Borders medical charity. Sarkozy reached over the political divide also in selecting Herve Morin, of a rival center-right party, as defense minister.
The posts were announced by presidential chief of staff Claude Gueant outside the presidential palace.
Juppe, who was prime minister from 1995 to 1997 and long said to be Chirac's preferred successor, capped a dazzling political return after his conviction in a party financing scandal. He was barred from holding political office for a year, and spent a year teaching in Canada.
The popular Borloo will be charged with making good on Sarkozy's planned economic reforms, including making it easier for companies to hire and fire workers and curbing the crippling power of strikes — goals that could run afoul of unions and others on the vocal French left.
Alliot-Marie will head counterterrorism efforts, leading the interior ministry that Sarkozy headed for four of the last five years where he led a crackdown on crime that caused his popularity to soar.