Guzman, head of the powerful Sinaloa Cartel, who Pena Nieto first caught in February 2014, was captured in an early morning raid in the city of Los Mochis in the drug baron's native state of Sinaloa in northwest Mexico.
"Mission accomplished: We have him," Pena Nieto said on his Twitter account. "I want to inform all Mexicans that Joaquin Guzman Loera has been arrested."
The operation to recapture Guzman involved Mexican marines, the U.S. Drug Enforcement Administration and U.S. Marshals, a senior Mexican police source said.
Prior to Pena Nieto's announcement, the Mexican Navy said a raid took place in Los Mochis based on a tip. Five people were killed in the standoff and six were captured, the Navy said.
A security source said Guzman was captured during that raid.
In October, the government said Guzman narrowly evaded security forces searching for him in the northwest of Mexico, sustaining injuries to his face and leg.
He staged a jaw-dropping jailbreak in July, when he escaped through the tunnel which burrowed right up into his cell, heaping embarrassment on Pena Nieto.
Dozens of people were arrested over the jailbreak, though details of who Guzman bribed and how his accomplices knew exactly where to tunnel into the prison remain scant.
Guzman now faces the prospect of extradition to the United States. After coming under fire for failing to do so the last time, Mexico's Attorney General's office said in July it had approved an order to extradite him north of the border.
An official at the attorney general's office, speaking on condition of anonymity, said his extradition would "take time".
Guzman is wanted by U.S. authorities for various criminal charges including cocaine smuggling and money laundering.
Once featured in the Forbes list of billionaires, Guzman's Sinaloa Cartel has smuggled billions of dollars worth of heroin, cocaine, marijuana and methamphetamines into the United States and fought vicious turf wars with other Mexican gangs.
The kingpin's legendary reputation in the Mexican underworld began to grow in 2001, when he staged his first jailbreak, bribing guards in a prison in western Mexico, before going on to dominate drug trafficking along much of the Rio Grande.
Still, many people in towns and villages across Mexico remember Guzman better for his squads of armed gunmen who carried out thousands of brutal slayings and kidnappings.
After Guzman's first prison break, violence began to creep up in Mexico and the situation deteriorated during the 2006-2012 rule of Pena Nieto's predecessor Felipe Calderon, when nearly 70,000 people lost their lives in gang-related mayhem.
Guzman's reputation grew and in 2013 Chicago dubbed him its first Public Enemy No.1 since Al Capone.
El Chapo, or "Shorty", is believed to be 58 years old. The 5-foot, 6-inch gangster's exploits made him a hero to many poor villagers in and around Sinaloa, where he was immortalized in dozens of ballads and low budget movies.
Security experts concede Guzman has been a master of his trade, managing to outmaneuver, outfight or outbribe his rivals to stay at the top of the business for over a decade.
Rising through the ranks of the drug world, Guzman watched his mentors' tactics, their mistakes and where to forge the alliances that kept him one step ahead of the law for years.
"El Chapo Guzman is a survivor," Anabel Hernandez, author of Narcoland: The Mexican Drug Lords and their Godfathers, said shortly after his July jailbreak.
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