The Queensland senator has taken over the regional party's top job after former leader David Littleproud's snap resignation on Tuesday.
Darren Chester, an MP from regional Victoria, was elected deputy leader and Victorian senator Bridget McKenzie remained Senate leader.
Senator Canavan was a key player in the coalition's decision to dump its net-zero emissions by 2050 target and is a major supporter of coal production, prioritising driving down energy prices over climate action.
In his first media conference as leader, the conservative senator outlined a nationalistic approach to policy.
"We need to go hyper-Australia for our country," he told reporters in the Nationals party room in Canberra.
"We need more Australian babies. We need more Australian humour, more Australian jokes. We need more Australian barbecues, sometimes often fuelled by fossil fuels. We need more Australian everything."
Asked about the difference between the Nationals under his leadership and One Nation, Senator Canavan accused Senator Hanson of peddling divisive politics and said her party was not a "grassroots" organisation like his.
"I struggle to point to a single dam, single road, single hospital that Pauline has delivered in Australia," he said.
Former Nationals leader Barnaby Joyce, who defected to One Nation in late 2025, disputed Senator Canavan's claims but said he relished the political debate.
"It's like now running on for a serious game of football. I'm really looking forward to it," he told reporters in Canberra.
Asked about Senator Canavan's argument about infrastructure, Mr Joyce said the situation was different now because he was One Nation's first lower house MP and so could advocate effectively for his local community.
Senator Canavan will face a baptism by fire, with the Farrer by-election - sparked by the resignation of former Liberal leader Sussan Ley after she was knifed by Angus Taylor - scheduled for May 9.
A popular independent is again contesting the once-safe Liberal seat after whittling down Ms Ley's margin at the 2025 election.
It is the first test for One Nation to see if it can convert popular polling into more seats in parliament.
Both nascent coalition leaders are under pressure to win the seat and shore up voters who are leaving major parties in favour of independents and minor parties.
Regional Queensland and NSW are considered particularly at risk of flipping to One Nation, threatening a number of electorates held by the Nationals.
Senator Canavan slapped down Senator Hanson's controversial suggestion there were no good Muslims.
"I was very critical of Pauline's comments, dividing Australians into groups ... I totally reject that," Senator Canavan said.
"We are all Australians, what unites us as a country is more than what divides us.
"I worry about where Pauline would take this country, to an area of more division."
Opposition Leader Angus Taylor congratulated the Nationals leader and his team on their election, praising their understanding of regional and rural Australia.
"Together with Matt and Darren, we will keep fighting every day for the country we believe in, because Australia is worth fighting for," he said in a statement.
Prime Minister Anthony Albanese took a swing at the coalition in Question Time, accusing them of focusing on themselves at a time of global crisis.
"With Australians feeling the impact of the war in the Middle East, the Nationals have elbowed their way to centre stage," he told parliament.
"Same old Liberals, same old Nats, same old One Nation, just three right-wing parties not standing up for Australia."
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