Bailey, a 36-year-old mother of two, was picked by the public over teenager Nicholas McDonald at the end of the live show in front of 10,000 people at Londons Wembley Arena.
Alongside a recording contract, she will support American pop superstar Beyonce on the UK leg of her Mrs Carter world tour in February.
The clear favourite before the announcement, Bailey was lost for words after being told she had received over a million votes.