May also reappointed an old adversary - Michael Gove, a former rival for the Conservative leadership whom May fired from the Cabinet when she took office a year ago.
She praised Corbyn's campaign but also said he had received "the fairest hearing in the broadcast media that he has had in two years". Further announcements were expected on Saturday. In the end, May must form a minority government, and is now reliant of the support of the Democratic Unionist Party [DUP], a hardline unionist party in Northern Ireland.
In light of recent terror attacks in Manchester and London, the Prime Minister vowed to "crack down on the ideology of extremists" as she promised "put fairness and opportunity at the heart of everything we do".
The DUP won't be involved with jointly running a shared legislative program if it helps May have a minority government, but it would support the Tories when it pushes through legislation through votes. Scottish Conservative leader Ruth Davidson - a rising star in the party - tweeted a link to a speech she made in support of gay marriage, drawing on her own experiences as a lesbian Christian.
In a move that could jeopardise her frantic attempts to remain as Prime Minister, the DUP is accusing Downing Street of announcing a deal on its MPs voting with the Tories in the Commons before an agreement has been reached.
A stony-faced Mrs May, speaking on the doorstep of her official Downing Street residence, said the government would provide certainty and lead Britain in talks with the European Union to secure a successful Brexit deal. Her predecessor, David Cameron, first asked British voters to decide in 2016 whether to leave the EU.
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"We need a government that can act", EU Budget Commissioner Guenther Oettinger told German broadcaster Deutschlandfunk. "With a weak negotiating partner, there's a danger that the (Brexit) negotiations will turn out badly for both sides".
European Council President Donald Tusk has warned there is "no time to lose" in starting Brexit talks, after May on March 29 started the two-year countdown to ending Britain's four-decade membership. The result ended his career and shocked Europe.
Unlike the Labour Party - which sweetened its platform with things like free tuition for university students - the Conservative Party contained little to get people excited. Prime Minister Theresa May says she's forming an alliance with the Democratic Unionist Party to stay in power.
Mr Corbyn said he would not make any coalition deals or pacts but would instead put forward Labour's own programme for government.
One of the other big surprises of the night was Scotland, in which the SNP lost seats to all the major parties but most notably the Conservatives. "I would have thought that's enough to go", Corbyn said after being re-elected in his Islington North constituency in central London. After all, May had cleverly called the election at a moment when it could not be about Brexit: one month after invoking Article 50 of the Treaty of Lisbon, thereby officially initiating the United Kingdom's withdrawal from the European Union.
He said Corbyn had been "sure-footed" in the campaign, and Labour could now build on his success - as long as the leader became more "ecumenical" in accepting the views of other members of his parliamentary team.
Almost 1,500 members responded, with just under 60 per cent saying she should go.
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