Yellen was sworn in by Daniel Tarullo, a central bank governor, the Fed said in release.
Yellen's term as chairwoman will end Feb. 3, 2018, and her term as a board member will end Jan. 31, 2024.
Yellen takes over as the Fed is reducing its asset buying program -- a sign of confidence in the economic recovery.
One of her biggest jobs will be to guide the exit so it doesn't upset the recovery and deal with a Congress that is skeptical of the Fed's actions, the Hill reported.
Yellen was nominated by President Obama in October, and confirmed by the Senate in January.