Kane, 46, took the stage just before 11 p.m., flanked by her husband and two young sons.
Freed conceded the race before supporters in Camp Hill.
"We ran a tough race," the 42-year-old prosecutor said, saying he had texted his opponent early in the race to say that whoever won, Pennsylvania would have a qualified attorney general.
Kane's victory came after an improbable rise in which she proved to be a feisty campaigner.
At her party's endorsement convention this year, she debuted as a relatively unknown figure in state Democratic circles up against more established candidates, including former U.S. Rep. Patrick Murphy from Bucks County and one-time Philadelphia district attorney candidate Dan McCaffrey. She benefited when the convention endorsed no one.
She handed Murphy a sound primary defeat after emphasizing her experience as a frontline prosecutor. A $2 million donation from her husband - Chris Kane, owner of a Scranton-based trucking business - did not hurt, either, paying for the ad campaign that propelled her at the polls.
In the general election campaign against Freed, Kane shifted focus, attacking him for his ties to two past attorneys general: Gov. Corbett and LeRoy S. Zimmerman.
Corbett's endorsement helped clear Freed's path of GOP challengers during primary season. Zimmerman, Freed's father-in-law, once served as board chairman for the Hershey Trust, a charity for disadvantaged children under investigation by the Attorney General's Office for alleged financial improprieties.
Freed never quite overcame the name recognition Kane earned during her spring fight with Murphy.
Freed contended that his eight years as Cumberland County's district attorney made him the better candidate to run the state's highest law enforcement office. That argument ultimately fell flat against Kane's crusading criticism of high-profile cases such as the Jerry Sandusky child sex-abuse scandal.
Kane specialized in child sex-crime prosecutions during her 12 years in the Lackawanna County District Attorney's Office, and the Sandusky case - the highest-profile sex-abuse prosecution ever undertaken by the Attorney General's Office - offered a prime showcase to tout her expertise.
Early on, she questioned Gov. Corbett's decision to put the case before a grand jury in 2009 while he ran for governor instead of arresting the former Pennsylvania State University assistant football coach as soon as his first accuser came forward. She has pledged to review Corbett's handling of the investigation when she assumes office in January.
She also attacked the governor over an inaccurate attack ad aired by an outside group that Corbett had supported in the past.
The spots, aired by the Virginia-based Republican State Leadership Committee in September, called Kane "soft on rape" and alleged she had given a light plea deal to a man convicted in the sexual assault of a 16-year-old. Independent fact-checking organizations later determined that she had barely handled any aspect of that case.
Corbett, arriving at Freed's Camp Hill event Tuesday night, said he could not understand why Kane focused on him throughout the campaign.
"She's more than welcome to look at what we did," the governor said. "She's the one that turned the attorney general's race political."
How much that antagonistic relationship with Corbett will carry over once she heads to Harrisburg in January remains to be seen. There, she will oversee an office with a staff of about 700 and subject to legislative battles over a budget that now stands at $81 million.
"It was never about politics, it was always about people," Kane said. "We have so much work to do, and I'm very honored and humbled to be the next attorney general."
Contact Jeremy Roebuck at 267-564-5218, email@example.com, or @jeremyrroebuck on Twitter.
Inquirer staff writer Amy Worden contributed to this article.