Republicans reacted with derision.
"There is no better person to preside over the most liberal House Democratic caucus in history than the woman who is solely responsible for relegating it to a prolonged minority status," said Paul Lindsay, spokesman for the National Republican Campaign Committee. "This decision signals that House Democrats have absolutely no interest in regaining the trust and confidence of the American people who took the speaker's gavel away from Nancy Pelosi in the first place," he said.
Pelosi, 72, has represented a San Francisco area district in the House includes becoming the first woman in history to serve as speaker. The tea party-fueled political wave of 2010 forced the gavel from her hand to Rep. John Boehner, an Ohio Republican.
Holding a news conference Wednesday morning, Pelosi said "we're very, very proud" of how large a role women played in the Nov. 6 election.
"We don't have the gavel" of majority status in the House, she said, "but we have unity. I think our caucus this morning demonstrated that very clearly."
"We must have the further empowerment of women," said Pelosi, who noted that when she came to Congress there were 23 women in the House compared to over 60 of the seats in the House. "Not enough. We want more," she said.
Pelosi was a major force behind the passage of Obama's health care overhaul and the Lilly Ledbetter Fair Pay Act. Even after the 2010 elections, when her party lost 63 seats, Pelosi was reelected Democratic leader by her caucus.
Pelosi's colleagues had said for days that the top leadership post was hers if she wanted it in the next Congress that begins in January. She refused to reveal her plans for a week after the Nov. 6 elections failed to give Democrats gain they wanted.
It was a disappointing, but not unexpected result of a bitter year of elections that focused on the tight contests for president and control of the Senate. Throughout, Pelosi raised millions of dollars for Democratic House candidates and insisted that the 25 seat gain was within reach. But in the end, Democrats will gain at most eight seats and Republicans will keep their majority.
Waiting in the wings of Democratic ranks was Pelosi's deputy, Democratic Rep. Steny Hoyer of Maryland, the party whip, whom she has known since they were congressional interns, and South Carolina Democrat James Clyburn, assistant to the Democratic leader.
Pelosi is the daughter and sister of former Baltimore mayors. Her father, Thomas D'Alesandro, Jr., served as mayor of Baltimore for 12 years after representing the city for five terms in Congress. Her brother, Thomas D'Alesandro III, also served as mayor.