The announcement came after a grand finale Wednesday night that included two hours of performances by this year's finalists, past contestants and several surprise celebrity guests.
The results show took place at the Kodak Theater in Los Angeles. Fans of local favorite Katharine were gathered in nearby Universal City and Taylor's fans were rooting for him in his hometown of Birmingham, Alabama. Both groups were shown on the Kodak's big screen live via satellite.
The finale opened with last year's winner, Carrie Underwood, and this year's 12 finalists all dressed in white singing Barry Manilow's "I Made It Through The Rain."
The evening included duets with the show's 12 finalists paired with surprise celebrity guests.
But, the biggest surprise of all was a performance by Prince who sang a medley of songs towards the end of the show.
Earlier, teen finalist Paris Bennett was brilliantly paired with jazz great Al Jarreau, to sing his "We're In This Love Together." Rocker Chris Daughtry joined Live to sing "Mystery" and Katharine teamed up with Meat Loaf to sing "It's All Coming Back To Me Now."
In between the songs, there were various attempts at comedy, some more successful than others.
Country girl Kellie Pickler, who was teased during the contest for her malaprops and not knowing what calamari was, did a few segments with celebrity Chef Wolfgang Puck.
Kellie got her first reluctant taste of escargot and Puck managed to send her screaming from the table when he introduced her to a few live lobsters.
2Other silliness included the Golden Idol Awards which "honored" the very worst performances the judges had to endure during the show's auditions.
One of the awards was for "best" celebrity impersonation. The winner: nerdy contestant Michael Sandeki, for his impersonation of Season 2 runner-up Clay Aiken.
Michael was asked to sing his audition song, Elton John's "Don't Let The Sun Go Down On Me," and looked genuinely surprised when the real Clay joined him on stage.
Divided up by gender, the six female finalists and six male finalists each had a chance to sing a medley of songs.
The six male finalists, Chris, Taylor, Ace Young, Bucky Covington, Elliott Yamin, and Kevin Covais sang Bachman Turner Overdrive's "Taking Care of Business," Fleetwood Mac's "Don't Stop," and John D. Loudermilk's blues/rock classic "Tobacco Road."
The women - Katharine, Paris, Kellie, Mandisa, Melissa McGhee, and Lisa Tucker - sang Shania Twain's "I Feel Like A Woman," Elvis Presley's "Trouble," Carole King's "Natural Woman," and Chaka Khan's "I'm Every Woman."
More duets included Elliot with Mary J. Blige singing U2's "One" and Taylor, joined by Toni Braxton, for Elvis Presley's "In The Ghetto."
3At the end of the medley, Bacharach's muse and one of the greatest interpreters of his music, Dionne Warwick, took the stage to sing her hit "Walk On By."
At that point Taylor and Kat came out to sing "That's What Friends Are For" with Warwick and the rest of the finalists.
But it would still be another thirty minutes before the winner was announced.
Taylor and Kat came back to sing a duet of "(I've Had) The Time Of My Life" from the movie "Dirty Dancing," which no doubt summed up their experience on the show.
Then, after the performance by Prince, Taylor learned that he would be this year's American Idol. In addition to the title, Taylor will get a record deal with Sony BMG.
Taylor was speechless at first, but after hugging Kat he managed to shout out his trademark phrase, "Soul Patrol!" and pump his fist in the air as he was cheered on by fans in Birmingham, Alabama, on the giant screen behind him.
Taylor closed out the evening by performing his upcoming single "Do I Make You Proud?"
More than 63.4 million votes were tallied after Tuesday night's performance show, according to "American Idol" host Ryan Seacrest.
4During the one hour episode, Kat and Taylor sang three songs, including the songs chosen to be their debut singles.
Katharine is 22, beautiful, young, and has a powerful voice — all of which fit the image of a typical pop idol.
Throughout the contest, her weakness was oversinging her songs. Each judge in his or her own way tried to get her to tone down the wailing.
The most successful was Simon Cowell. The cranky British judge chose the 1939 classic "Over The Rainbow" for Kat to sing on May 16. Sitting on the stage, Kat sang the song gently, with feeling, and no screeching, much to the delight of the audiences — and Simon.
Tuesday night Kat sang, in order, KT Tunstall's "Black Horse in a Cherry Tree," "Over the Rainbow," and her new song, "My Destiny."
Taylor is a 29-year-old veteran of the nightclub scene who also plays a mean harmonica. He entered the competition as something of a goofy novelty.
Despite his loose-legged dance moves and an "aw shucks!" attitude, Hicks won over fans and judges with consistently solid vocal performances and an ability to command the stage like a veteran showman.
In the final competition episode, Taylor sang Stevie Wonder's "Livin' For The City," Elton John's "Levon" and his single, "Do I Make You Proud?"
According to Simon, Taylor "slaughtered" Kat in Round 1, but Kat managed to even the score in Round 2.
Following Round 3, Simon called Kat a "great potential artist," but after Taylor performed Simon said, "Assuming that I was right that the show was tied, then you've just won 'American Idol.'"
Of course, Ryan Seacrest took that as an opportunity to remind the audience that Simon turned Taylor down during the audition phase of the contest. Taylor made it into the contest because judges Randy Jackson and Paula Abdul voted him in.
Simon got the last laugh. Even though he's not in need of any ego-boosting, he correctly predicted Taylor Hicks would win the contest.
By Judy Faber