Dubai bested competing bids from Izmir, Turkey; Sao Paulo, Brazil; and Yekaterinburg, Russia, after three rounds of voting by delegates of the 168-nation Bureau International des Expositions in Paris.
In line with its reputation for over-the-top glitz, Dubai lit the world's tallest tower with glimmering lights. The skies around the Burj Khalifa, which towers at 2,717 feet, erupted with fireworks.
The logo of its bid for the 2020 expo was plastered on police cars, convenience store bags, storefronts, taxis, receipts, government buildings and even on a flag on Mount Kilimanjaro.
A spending spree was already underway even before officials announced the host city. Dubai estimates a successful Expo 2020 bid will generate $23 billion between 2015 and 2021, or 24 per cent of the city's gross domestic product. They say total financing for the 6-month-long event will cost $8.4 billion.
In a statement after the vote, Dubai ruler and U.A.E. vice-president Sheikh Mohammed bin Rahid promised to "astonish the world" in 2020.
"Dubai Expo2020 will breathe new life into the ancient role of the Middle East as a melting pot for cultures and creativity," he said.
Delegates voted behind closed doors over three rounds to choose the winner, with Sao Paolo and Izmir eliminated in the second round.
Sao Paulo had proposed a renewable energy tower to convert solar energy into the electricity needed for the event and a new economic, tourism and education hub with hotels, schools, and shopping malls.
Izmir, an Aegean coastal city formerly known as Smyrna, had pushed global health and environmental issues for its bid and had chosen award-winning architect Zaha Hadid to design the park for the exposition.
Russia treated its bid to hold the expo as a state priority not unlike its bids to host the Winter Games and the World Cup. Organizers of the pitch for the Ural Mountains city of Yekaterinburg were planning to build 103 pavilions for the expo and accommodation for exhibition participants, later to be converted into a residential area.
The announcement comes just days before the Dec. 2 U.A.E. national day, which celebrates the young nation's 42 years of unity and independence from the British Protectorate.
The official Twitter account for Dubai's world expo bid wrote after the announcement that the win "will help unlock the vast potential of this region" and that it is the first World Expo to be held in the Middle East.
"The UAE is proud to have been selected to host #Expo2020 in #Dubai under the theme 'Connecting Minds, Creating the Future'," said Dubai authorities on their official expo bid account.
While the World's Fair no longer holds the popularity of other global events like the Olympics or World Cup, it remains a chance for millions from around the world to discuss and see the business of the future.
Last year Yeosu, South Korea, hosted the 2012 world expo. The next one is scheduled to take place in Milan in 2015.
Associated Press reporter Aya Batrawy in Dubai contributed to this report.
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