Magyar's centre-right Tisza party defeated Orban's nationalist-populist Fidesz in a stunning blow in April, gaining more votes and seats in parliament than any other party in Hungary's post-Communist history.
The win, which gave Tisza a two-thirds parliamentary majority, will allow it to roll back many of the policies that gave Orban a reputation among many of his critics as a far-right authoritarian, clamp down on alleged corruption and transform political dynamics within the European Union, where the former prime minister had upended the bloc by frequently vetoing key decisions.
Magyar entered the sprawling neo-Gothic parliament building on Saturday alongside 140 of his party representatives, controlling 141 seats in Hungary's 199-seat parliament.
Orban's Fidesz-KDNP coalition will control 52 seats, down from 135, while the far-right Mi Hazank (Our Homeland) party will hold six seats.
The 199 representatives took their oaths of office late in the morning.
Orban was not among them for the first time since Hungary's first post-Communist Parliament was formed in 1990.
The new national assembly has 54 women lawmakers, most from the Tisza party - more than a quarter of the total and the most in Hungary's history.
Magyar, a 45-year-old lawyer who founded Tisza in 2024 after years as an insider in Orban's party, has vowed to end official corruption, which he argues has robbed Hungarians of economic opportunity.
The new prime minister has called on Hungarians to attend an all-day "regime-change" celebration outside parliament to mark his inauguration and the end of the Orban era.
Several thousand people had already gathered as the new representatives were sworn in.
After he takes his oath midafternoon, Magyar is set to address the crowd outside.
Magyar has promised to repair his country's ties with the EU, which Orban had pushed to the breaking point, and to restore Hungary's place among Western democracies, whose standing had been called into question as Orban drifted ever closer to Russia.
Unlocking about 17 billion euros ($A28 billion) of EU funds for Hungary frozen during Orban's time in office over rule-of-law and corruption concerns is among the incoming prime minister's top priorities.
The money is sorely needed to help jump-start Hungary's struggling economy, which has stagnated for the last four years.
In a sign of that commitment, Tisza officials say they will once again fly the EU flag on the Parliament building's facade after Orban's government removed it in 2014.
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