The Constitutional Court will decide whether to remove Yoon sometime in the next six months.
If he is removed from office, a snap election will be called.
Prime Minister Han Duck-soo, who was appointed by Yoon, became acting president while Yoon remains in office but with his presidential powers suspended halfway through his five-year term.
Han promised his utmost efforts to ensure stability after Yoon's impeachment.
"I will give all my strength and efforts to stabilise the government," Han told reporters.
Yoon is the second conservative president in a row to be impeached in South Korea.
Park Geun-hye was removed from office in 2017.
Yoon survived a first impeachment vote last weekend, when his party largely boycotted the vote, depriving parliament of a quorum.
"Although I am stopping for now, the journey I have walked with the people over the past two and a half years toward the future must never come to a halt. I will never give up," Yoon said on Saturday.
Regarded as a tough political survivor but increasingly isolated, he has been dogged by personal scandals and strife, an unyielding opposition and rifts within his own party.
There were party scenes outside the National Assembly in Seoul as people celebrated the impeachment. (AP PHOTO)
Protesters backing Yoon's impeachment leapt for joy near parliament at the news, waving colourful LED sticks as music pumped out.
By contrast, a rally of Yoon supporters emptied following the news.
Opposition Democratic Party leader Lee Jae-myung told protesters near parliament that they should fight together so Yoon was removed as quickly as possible.
"You, the people, made it. You are writing a new history," he told the jubilant crowds braving sub-freezing temperatures.
The impeachment motion was carried as at least 12 members of Yoon's People Power Party joined the opposition parties, which control 192 seats in the 300-member national assembly, clearing the two-thirds threshold needed for impeachment.
The number of lawmakers supporting impeachment was 204, with 85 against, three abstentions and eight invalid ballots.
Yoon shocked the nation late on December 3 when he gave the military sweeping emergency powers to root out what he called "anti-state forces" and overcome obstructionist political opponents.
He rescinded the declaration barely six hours later, after parliament defied troops and police to vote against the decree.
But it plunged the country into a constitutional crisis and triggered widespread calls for him to step down on the grounds that he had broken the law.
Yoon later apologised to the nation but defended his decision and resisted calls to resign.
Opposition parties launched the fresh impeachment vote, supported by large demonstrations.
Yoon is also under criminal investigation for alleged insurrection over the martial law declaration, and authorities have banned him from travelling overseas.
In another defiant speech on Thursday, Yoon vowed to "fight to the end", defending his martial law decree as necessary to overcome political deadlock and protect the country from domestic politicians who he said were undermining democracy.
Yoon's impeachment is unlikely to end South Korea's political turmoil, analysts warned.
"It is not even the beginning of the end," said Leif-Eric Easley, a professor at Ewha University in Seoul.
Opposition leader Lee, who narrowly lost to Yoon in 2022 and is favoured to win an election to replace him, is also in legal jeopardy, with a conviction on appeal and other rulings pending that could disqualify him from office.
"So before the final race in the polls, there will be a race in the courts," Easley said.
