Chief executive Tim Cook claimed to have "redefined once again the category Apple created".
Apple dominates the market but should face a fresh challenge later this year when tablets running the full Windows 8 system are expected to go on sale.
The new iPad – which is simply called by that name – also features a 5-megapixel camera sensor. It will be able to run on 4G LTE networks where the service is available and can act as a wi-fi hotspot for other devices if carriers allow the function.
It is 9.4mm deep, slightly thicker than the 8.8mm profile of the iPad 2. The basic 16GB model with only wi-fi will cost £399 and the top of the range 64GB model with wi-fi and 4G will cost £659.
Apple’s marketing chief Phil Schiller said the tablet has the same 10-hour estimated battery life as the previous model using only wi-fi. That limit shortens by an hour when using 4G.
It is due to go on sale on 16 March in the UK, US, Canada, Germany, France, Switzerland, Hong Kong, Singapore, Australia and Japan.
The previous model will stay on sale at a reduced price, starting at £329. Mr Schiller said that would make it more affordable for schools to buy the machine.
The firm also announced an upgraded TV box which can now handle 1080p video.
Films and TV shows will be sold via its iTunes store in the high-definition format.