Peter E. Carter was the candidate the board was expected to approve on Tuesday.
But Carter, a retired 30-year veteran administrator in New Jersey public schools, withdrew his name hours before the board's vote.
The decision to appoint Mills did not come until around midnight, when the board came out of closed session.
Mills will receive a $1,250 monthly stipend, on top of his $160,000 salary, to fill the top spot in the struggling school district.
Mills' appointment will go to Camden County Superintendent of Schools Peggy Nicolosi for final approval. The stipend is the same Mills received while Young was on leave last year and early this year.
Before the closed session, Young turned her answer to a question into an impromptu farewell speech. In her remarks she accused the state of pushing an agenda of privatizing public schools and using the district's money to do it.
"You are allowing people to reorganize, re-budget your money," Young said, speaking to the audience of about 50 people and the district's television camera, which broadcasts the meetings to residents on Channels 19 and 30.
"I am saddened by the fact that for some reason, somehow, somebody thought they could come in and use Camden as a wholesale market," Young said. "They want your money and they don't care how they get it."
While most of the board heard her in stoic silence, she elicited claps of approval from some in the audience and occasional whoops from Board Vice President Martha Wilson.
State Department of Education spokeswoman Barbara Morgan disputed Young's assertions.
"Charter schools are public schools and renaissance schools will be run by nonprofits," Morgan said, adding that most taxpayer dollars still would go to traditional public schools.
Charter schools receive up to 90 percent of per-pupil expenses. Under the state's Urban Hope Act, enacted early this year, nonprofit entities are allowed to construct "renaissance" schools, which could get up to 95 percent of per-pupil costs.
Renaissance schools may hire private companies, without any public bidding, for a range of services, including staffing, management, and bookkeeping.
"There is money in poor-performance and poverty," Young said.
A former top administrator in the Philadelphia School District, Young had a year left in her contract, with a $244,083 salary.
Young faced intense criticism this year from state and city officials as well as community members for her long absences and a lack of improvement in academic performance. She blamed her absences on a chronic illness.
Of the district's 26 schools, 23 have been placed on the state's "priority" list of the 72 academically worst-performing schools.
Four of those 23 will have to get new principals under a new state rule that a principal must produce adequate improvement on student scores within three years or face reassignment within a district.
According to district records, as of late January, Young was absent from work at least 186 days - about the length of a school year - during the previous 18 months.
"I've enjoyed working with the young people and the adults of this district knowing that every day was a struggle trying to work for the positive, yet working against those who are working against you, not working for you," she said.
The board will meet next month to discuss the next step in the search for a superintendent, both an interim and a permanent one, said board attorney Lester Taylor.
Before coming to Camden as part of Young's team in 2007, Mills served as director of school support services in Philadelphia, overseeing professional development for principals, school police, and food service personnel.
He received his New Jersey administrator certificate in 2008, according to a copy provided by the district.
Neither he nor Young on Wednesday returned calls for comment.
Contact staff writer Claudia Vargas at 856-779-3917, or email@example.com or on Twitter @InqCVargas. Read her blog, "Camden Flow," at www.philly.com/philly/blogs/camden_flow/