At an SPD party meeting in Berlin, he denounced Eurosceptics and the "racist" rhetoric of US President Donald Trump.
The convention unanimously confirmed Schulz as the candidate who will lead the Social Democrats to the election.
It has been the junior partner in Germany's "grand coalition" since 2013.
The party hopes that Schulz, a former president of the European Parliament, will boost its chances of governing without Merkel's CDU.
Opinion polls suggest the Social Democrats trail the CDU, although Schulz's personal rating compares favourably with that of Merkel, who plans to run for a fourth term.

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