Suga, who was picked to succeed Prime Minister Shinzo Abe as leader of the ruling Liberal Democratic Party on Monday, is set to be named premier in an extraordinary Diet session on Wednesday.
Suga has also promised to continue his predecessor's economic policy "Abenomics" that focused on Japan's economic revival and combined structural reform, monetary easing and fiscal expansion, with the goal to increase domestic demand.
Nikai, who has served in the party's No. 2 post since 2016, is known as a power broker and played a key role in Suga's victory over current LDP policy chief Fumio Kishida and former Defense Minister Shigeru Ishiba.
"Now I'm handing the baton to new LDP President Suga", Abe said after the vote.
If so, his Cabinet would also be announced later that day.
As his parents' eldest son, Suga defied tradition by deciding not to take over the family farm.
Suga won a lower house seat in 1996 and was a long-time backer of Abe, pushing him to stand for a second term despite his disastrous first run in office, which ended after just a year.
"I was born as the oldest son of a farmer in Akita", Suga said after Monday's election.
Suga has said his top priorities are fighting the coronavirus and turning around an economy battered by the pandemic.
Suga appointed Seiko Noda and Tamayo Marukawa, two female lawmakers, as the party's executive acting secretary general and head of its Public Relations Headquarters, respectively.
While during his days as a student, Suga showed little interest in the student protests against the security alliance between Japan and the U.S. and the Vietnam War, he gradually became interested in politics and successfully ran for the Yokohama city assembly in 1987 and entered national politics in 1996.
Yoshihide Suga is poised to win Japan's ruling party leadership vote on Monday, virtually guaranteeing him parliamentary election as the country's next prime minister.
Chinese foreign ministry spokesperson Wang Wenbin congratulated Suga and expressed willingness "to deepen cooperation in the fight against the epidemic and economic and social development, and continuously promote improvement and development of China-Japan relations". He said he wanted to solve the issue of Japanese nationals captured by North Korea in the 1970s and 80s.
He also will have to decide what to do with the Tokyo Olympics. Others think he will last longer. And he will have to build a relationship with whoever wins the US presidential race.