Cardinal Prevost will be known by the name Leo XIV and is both the first American, and first native English-speaker to be appointed to the papacy.
He has been described as a thoughtful listener, with a strong focus on peace and bridge-building, by Melbourne Archbishop Peter Andrew Comensoli.
Archbishop Comensoli, who has met Pope Leo several times in person, told AAP that he was a "great listener".
He says it's wonderful to have a new pope with "wide experience and great depth of faith".
"Clearly the cardinals were confident that they chose Cardinal Prevost," Archbishop Comensoli told AAP.
"It's great news. We have a chief shepherd and we will all look forward to getting a sense of him, as he begins his ministry as the successor to Peter."
Sydney Archbishop Anthony Fisher said the Chicago-native's "missionary heart" would hold him in good stead.
"Like the late Pope Francis, Pope Leo XIV will bring to the church the experience of being part of a religious order with an emphasis on simplicity and community," he said.
"It was very moving that the Holy Father opened his first address to a watching world with a greeting of peace, and repeated the central truth of the gospel, that God loves all of us 'without any limits or conditions'."
Leo spent decades as a missionary in Peru, before Pope Francis appointed him to lead the Vatican's bishop selection process.
Archbishop Fisher, along with Prime Minister Anthony Albanese, invited Leo to the International Eucharistic Congress, to be hosted in Sydney in 2028.
Mr Albanese said the appointment brought joy and hope to Catholics everywhere.
"May the papacy of Pope Leo advance the cause of peace and social justice for all humanity," he said.
Australian Catholic Bishops Conference president Archbishop Timothy Costelloe offered the Catholic church in Australia's heartfelt congratulations.
"Cardinal Prevost brought to his most recent role as Prefect of the Dicastery for Bishops an approachability and willingness to listen which were no doubt developed throughout his many years as an Augustinian missionary in Peru," Archbishop Costelloe said.
Catholic Social Services Australia executive director Jerry Nockles said Pope Leo's appointment came at a critical time when the world yearned for compassionate leadership grounded in gospel values of justice, dignity and solidarity with the vulnerable.
"At a time when Australia and indeed the world faces unprecedented social challenges - from growing inequality to escalating violence and social division - Pope Leo's election offers a beacon of hope and a powerful reminder that the church stands firmly for peace and with those on the margins," Dr Nockles said.
Cardinal Mykola Bychok was the sole Australian representative at the conclave in Rome.
Archbishop Costelloe and Sale Bishop Greg Bennet have indicated they will travel to Rome for the installation representing the Australian Catholic Bishops Conference and the church in Australia.
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