President-elect Barack Obama is filling his Cabinet at record speed, choosing loyal friends and one-time foes to guide his wartime foreign policy decisions.

Obama on Monday announced Democratic primary rival Hillary Rodham Clinton as his secretary of state and said that President George W. Bush's defense secretary, Robert Gates, is staying on.

Obama also named Washington lawyer Eric Holder as attorney general and Arizona Gov. Janet Napolitano as homeland security secretary. He also announced two senior foreign policy positions outside the Cabinet: campaign foreign policy adviser Susan Rice as U.N. ambassador and retired Marine Gen. James L. Jones as national security adviser.

The announcements rounded out the top tier of the team that will advise the incoming chief executive on foreign and national security issues in an era marked by wars in Iraq and Afghanistan and terrorism around the globe.

"In this uncertain world, the time has come for a new beginning — a new dawn of American leadership to overcome the challenges of the 21st century, and to seize the opportunities embedded in those challenges," Obama said.

Pointing to recent terrorist attacks in Mumbai and elsewhere, Clinton said, "America cannot solve these crises without the world and the world cannot solve them without America."

Obama also has settled on former Senate Democratic leader Tom Daschle to be his secretary of Health and Human Services and New Mexico Gov. Bill Richardson to be Commerce secretary. Last week, he named key members of his economic team, including Timothy Geithner, president of Federal Reserve Bank of New York, as Treasury secretary.

The decisions mean Obama has half of the 15-member Cabinet assembled less than a month after the election, including the most prominent positions at State, Justice, Treasury and Defense. With the world grappling with war, recession and terrorist threats that erupted this week during coordinated attacks in India, Obama was moving swiftly to try to bring reassurance and continuity in the federal government when he takes over in less than two months.