Espy, 64, campaigned as a moderate who would work with Trump and Republicans to benefit the state.
Hyde-Smith's strategy over the past few weeks has been mostly to avoid the media - leaving through back doors and jogging past cars to avoid interacting with reporters - and tie herself as closely as possible to Trump.
She thanked President Donald Trump for his support, including two campaign stops he made Monday.
All of that helped the former state agriculture commissioner tiresome Espy's efforts to paint her as someone who would take the state backwards.
Polls show four-term State Attorney Jim Hood defeating any Republican hopeful and becoming the state's first Democratic governor in 16 years.
Hyde-Smith was appointed to the seat earlier this year after longtime incumbent Thad Cochran resigned due to ill health.
The Hyde-Smith and Espy runoff was tainted by race-related controversies.
Chances of a Democratic victory in Mississippi- a state Donald Trump won by almost 18 percentage points in the 2016 election and whose senior senator, Republican Roger Wicker, was re-elected by almost 20 points earlier this month - still appeared remote.
As an isolated special election - and the last federal election of the 2018 cycle - the runoff attracted outsize national attention.
Having been heavily favored to win the reliably Republican state, Hyde-Smith became engulfed in a political storm over a video showing her praising a supporter at a November 2 event by saying, "If he invited me to a public hanging, I'd be on the front row". She said it was "an exaggerated expression of regard".
"The state has a history of racially motivated lynchings, and the comment angered many voters". She at first refused to apologize, and only at last week's debate did she offer a conditional apology "to anyone offended".
In a statement Tuesday night, Espy, an African American politician, said the election is "the beginning, not the end".
Hyde-Smith, 59, secured more than 53 percent of the vote compared to her opponent, Democrat Mike Espy, at a ballot she described to be about "conservative values". Photos on her Facebook page from 2014 showed her wearing a Confederate soldier's hat during a tour of the Jefferson Davis Home and Presidential Library. The caption on the post read, "Mississippi history at its best!"
The same progressive blogger who published the video of her using the phrase "public hanging" later published one in which Hyde-Smith told a small group at Mississippi State University that suppressing the votes of students at other colleges was "a great thing". Espy would also be one for Democratic leaders like Chuck Schumer and Nancy Pelosi. Hyde-Smith and her allies pounded on him for lobbying for the former president of the Ivory Coast, who faces charges of crimes against humanity.
While Hyde-Smith largely stayed off the campaign trail, the party's infrastructure rallied to her defense.
The Associated Press called the race for Hyde-Smith at 10:24 P.M. ET. But his biggest hope was driving up turnout among African-Americans.
The Democratic candidate would have been the first black person elected to the Senate from MS since Reconstruction if he had defeated Hyde-Smith.