Gillibrand said Friday that she realizes she's unfamiliar to many but that she will work hard to fill Clinton's shoes.
"She is dynamic, she is articulate, she is perceptive, she is courageous, she is outspoken," Paterson said at a news conference, calling his choice a "good government advocate" who had a slate of accomplishments despite her short time in Congress.
Gillibrand, elected in 2006, represents the state's 20th congressional district in the U.S. House of Representatives. She is the first Democrat to represent the district since 1978 -- and the first female representative of the district. Paterson said his choice had nothing to do with gender or geographic location.
Clinton congratulated Gillibrand in a written statement. "I'm pleased that this seat, which has been my great honor to hold, and which has in its history been held by leaders like former Senators Daniel Patrick Moynihan and Robert F. Kennedy, will be in such capable hands," she said.
But some New York City Democrats are skeptical of Gillibrand, who voted against the financial rescue package last fall. And the National Rifle Association has endorsed Gillibrand -- another cause for concern among some Democrats.
The appointment lasts until 2010, when a special election will be held to fill the final two years of Clinton's term. U.S. Rep. Carolyn McCarthy, who wasn't among the 10 to 20 people Paterson said applied for the Senate appointment, immediately criticized Gillibrand, saying her support of more conservative issues such as gun ownership rights was out of step with most New York Democrats.
McCarthy, a popular, proven politician whose husband was slain and son wounded in the 1993 Long Island Rail Road shooting massacre, says either she will challenge Gillibrand in a primary next year, or find a younger candidate to enter the contest.
"I will certainly raise my voice and run if no one comes forward," McCarthy, 65, said in a telephone interview Friday. "Believe me, this is a personal issue for me. I don't think someone with a 100 percent NRA rating should be the next senator from New York."
Despite the criticism from McCarthy, Gillibrand is a proven vote-getter in the largely rural eastern New York district that sprawls from the mid-Hudson Valley to north of Albany. She defeated a long-term Republican incumbent in 2006 and won re-election last year by a wide margin.
Gillibrand had her second child last May, making her only the sixth woman to bear a child while serving in Congress.
She lives with her husband and two sons, 5 years old and 6 months old, in Greenport, N.Y., in the Hudson River Valley.
Rev. Al Sharpton said he thought the decision was a good political move, drawing into the fold conservative democrats who are powerful in upstate New York.
"I think politically it will help the governor, it will help the team. She will do some things for them upstate -- look what happened in Virginia. Conservative democrats are winning so politically it might be a plus," he told FOXNews.com. "It gives balance."
The choice of Gillibrand follows weeks of broad speculation over whom Paterson would choose, the presumed frontrunners being Cuomo and Caroline Kennedy, the daughter of President Kennedy.
Kennedy had campaigned vigorously for the position but withdrew her name from consideration Wednesday, citing "personal reasons." That sparked a flurry of media reports on other potential motives for her decision, rumors that she described, through a spokesman, as untrue "mudslinging."
Clinton resigned from the Senate this week to be sworn in as President Obama's secretary of state.
FOX News' Chad Pergram and FOXNews.com's Joseph Abrams and Trish Turner contributed to this report.