Mnangagwa, a secretive hardliner known as 'The Crocodile', is well set as the eventual successor to Africa's oldest head of state.
The 68-year-old is one of Mugabe's most trusted lieutenants, having served at his side through five decades of prison, guerrilla war and then post-liberation government.
Mnangagwa has been a strong supporter of Mugabe's economic nationalism, especially a drive to force foreign firms to cede majority stakes to local blacks, suggesting he may not be the pro-market pragmatist many investors were hoping for.
(READ MORE: Zimbabwe's Mugabe fires deputy, to name new cabinet - sources)
He has been in every administration since the southern African nation's independence from Britain in 1980, holding posts as varied as minister of state security, defence and finance, as well as speaker of parliament.
Most controversially, the new vice-president of the ruling ZANU-PF party was in charge of internal security in the mid-1980s when Mugabe deployed a crack North Korean-trained brigade against rebels loyal to political rival Joshua Nkomo.
Rights groups say 20,000 civilians, most of them from the minority Ndebele tribe in western Zimbabwe, were killed.
Mugabe denies genocide or crimes against humanity but has admitted it was a "moment of madness".
Mnangagwa's role remains shrouded in mystery, typical of a political operator trained as a communist guerrilla in China in the 1960s and remaining since his teens in the shadows behind Mugabe's shoulder.
Along the way, he earned the monicker 'Ngwena', Shona for 'Crocodile', an animal famed in Zimbabwean lore for its stealth and ruthlessness.
Secretive and insular, he prefers to operate under the radar, those in his inner political circle say, and when pushed into a corner, resorts to jokes and trivia to avoid serious discussion.
"I wouldn't say he is deceptive but it's fair to say his default position is to crack jokes and deflect uncomfortable questions by asking endless questions," one member of parliament close to him said.
"He is very conscious that his public image is that of a hard man but he is a much more complex personality -- pleasant and an amazing story-teller," the politician, also from Mnangagwa's province, told Reuters.
Mnangagwa's appointment was cheered loudly by ZANU-PF's 300-member central committee, a day after former deputy Joice Mujuru was fired for allegedly planning to topple Mugabe. .
Asked whether the purge would not weaken the party, a smiling Mnangagwa told journalists:
"The revolution has a way of way of strengthening itself. It goes through cycles, this is another cycle where it rids itself of elements that had now become inconsistent with the correct line."
Mnangagwa learnt his politics in prison in the 1960s after being jailed and sentenced to death for sabotage by then-Rhodesia's British rulers following his capture while in one of the earliest guerrilla units fighting white colonial rule.
He was 19 at the time and was only spared the noose by a law prohibiting the execution of convicts under 21.
After a decade in prison, often sharing a cell with Mugabe, Mnangagwa became personal assistant to the leader of the liberation struggle, and went on to head the guerrilla movement's feared internal security bureau.
During a brief stint as finance minister in the 1990s, businessmen said he was more flexible than his mentor Mugabe, and alert to the demands of the economy and the need to balance them with the pressures of party politics.
"There is a history of pragmatism, both in negotiation and in practice," said Eldred Masunungure, a political science lecturer at the University of Zimbabwe.
For Mugabe, however, Mnangagwa's attraction lies in the need for a strongman to protect his family's business interests in the turbulence that is likely to follow the departure of the only leader Zimbabwe has known.
"There are no arguments around his credentials to provide strong leadership and stability, but there are questions over whether he can also be a democrat," Masunungure said.