A White House statement said the ceremony was held in the Oval Office at 9:30 a.m. prior to a Cabinet meeting at 10 a.m.
In response to reports that the White House is in turmoil, Trump on Twitter suggested that his administration's accomplishments are evidence there are no problems.
"Highest Stock Market EVER, best economic numbers in years, unemployment lowest in 17 years, wages raising, border secure, S.C.: No WH chaos!" Trump tweeted.
Prior to Priebus' departure, The New Yorker magazine published a profanity-laced interview with newly named White House communications director Anthony Scaramucci, who fueled rumors of discord with Priebus.
"Reince is a [expletive] paranoid schizophrenic, a paranoiac," Scaramucci said, suggesting Priebus and White House chief strategist Steve Bannon were behind White House leaks.
Prior to joining the Trump administration, Priebus was chairman of the Republican National Committee and Republican Party of Wisconsin.
Politico reported Kelly has griped privately for months about the disarray at the White House and now his job is to bring order to the chaos -- but one person close to Kelly told the outlet it will not be an easy task.
"I think this is the best and last shot," the anonymous source said. "This is it."