"Newt is not perfect, but who among us is?" Perry said. He called the former House Speaker a "conservative visionary" best suited to replace Barack Obama in the White House.
While the ultimate impact of Perry's decision is unclear, it reduced the number of conservative challengers to Mitt Romney. The decision also reinforced the perception that Gingrich is the candidate on the move in the final hours of the South Carolina campaign, and that the front-running Romney is struggling to hold onto his longtime lead.
Perry had scarcely finished speaking when Gingrich issued a statement welcoming the endorsement. "I ask the supporters of Governor Perry to look at my record of balancing the budget, cutting spending, reforming welfare, and enacting pro-growth policies to create millions of new jobs and humbly ask for their vote," Gingrich said.
Romney reacted by praising Perry for running "a campaign based upon love of country and conservative principles" and saying he "has earned a place of prominence as a leader in our party."
Perry's exit marked the end of a campaign that began with soaring expectations, but quickly faded. He shot to the head of the public opinion polls when he announced his candidacy last summer, but a string of poor debate performances soon led to a decline in support.
His defining moment came at one debate when he unaccountably could not recall the third of three federal agencies he has promised to abolish. He joked about it afterward, but never recovered from the fumble.
Romney, the former Massachusetts Governor considered the more moderate candidate in the race, has benefited thus far from having several conservative challengers competing for the same segment of voters. New polls show Romney leading in South Carolina but Gingrich gaining steam heading into Saturday's contest in a state where conservatives hold great sway in choosing the GOP nominee.
Perry's decision to endorse Gingrich does not necessarily mean conservatives will rally behind the former House speaker. Former Pennsylvania Sen. Rick Santorum, a champion of the anti-abortion issue, is still in the race and over the weekend was endorsed by a group of evangelical leaders.
And there's no guarantee that the Texas donors who fueled Perry's bid will shift to Gingrich, even if the Governor asks them to.
Romney has been working to court them in recent weeks, having made repeated visits to Texas to meet with major Republican donors. He also won the backing of former President George HW Bush. Several Perry supporters, who spoke on the condition of anonymity to avoid publicly discussing their next steps before Perry's announcement, said they have been approached by Romney's campaign and will support him as the most-likely candidate to face President Barack Obama in November.
At least three so-called "super" political action committees have sprung up since early 2011 supporting Perry. One, Americans for Rick Perry, raised about $193,000 during the first half of 2011, federal election records show.
But none of the groups has been more prominent than Make Us Great Again, which aired more than $3.3 million worth of ads in Iowa and South Carolina supporting the Texas Governor. A spokesman for the group did not immediately return calls from the AP seeking comment about whom, if anyone, the PAC would support after Perry drops out.
Perry entered the race last August to great fanfare and high numbers in polls. But his standing quickly fell after a series of gaffes and other verbal missteps. Those errors called into question whether the Texas politician who had never lost a race during his three-decade career in elected office was ready for the national stage.
His biggest flub came in a nationally televised debate in early November, when he could not remember the name of the third Cabinet department he pledged to eliminate.
Perry could only manage to say, "Oops." Making fun of himself afterward, he told reporters: "I stepped in it."
It was a cringe-inducing moment replayed more than a million times on YouTube. The memory lapse not only solidified Perry's reputation for weak debate performances, it gave the impression that he couldn't articulate his own policies. The stumble further tamped down his already faltering poll numbers.
Perry, 61, was relatively unknown outside of Texas until he succeeded George W Bush as Governor after Bush was elected president in 2000. A former Democrat, Perry had already spent about 15 years in state government when he became Governor. He went on to win election to the office three times - the most recent was in 2010 - to become the state's longest-serving chief executive.
Part of Perry's appeal came from his humble beginnings as a native of tiny Paint Creek, Texas. He graduated from Texas A&M University and was a pilot in the Air Force before winning election in 1984 to the Texas House of Representatives. He switched to the GOP in 1989, and served as the state's agriculture commissioner before his election as lieutenant Governor in 1998.
Perry's success as a politician suggested he would be a strong competitor to Obama. He had never lost a race in Texas, and his fight against Sen. Kay Bailey Hutchison for the Republican gubernatorial nomination in 2010 showed how tough he could be on a rival.
Perry picked August 13 for his official announcement speech, the same day as the Iowa Straw Poll. While rival Michele Bachmann won that poll, the Texas Governor cast a shadow over her victory by challenging her as conservatives' best hope for winning the nomination and defeating Obama.
He entered near the top of some polls. But his support of a Texas policy to allow children of illegal immigrants to pay in-state tuition rates soon proved to be problematic with conservatives nationwide. So, too, did his 2007 order that would have required schoolgirls in Texas to be vaccinated against human papillomavirus. Although state lawmakers overturned the order, Perry defended the vaccination as necessary to combatting the sexually transmitted virus that can cause cervical cancer.
His performance on the campaign trail also led to concerns about how his rhetoric would sound to a national audience. During a campaign stop in Iowa in August, he suggested that Federal Reserve Chairman Ben Bernanke would be practically committing treason if he were to print more money and said, "I don't know what y'all would do to him in Iowa, but we would treat him pretty ugly down in Texas."
A Perry speech to a New Hampshire audience in October led to a damaging video, during which he appeared unusually animated - "loopy" to some observers - a stark contrast to the image of the serious, starchy Governor he had projected. Amid questions, Perry later told reporters that he hadn't been drinking or taking medication at the time and called it "a pretty typical speech for me."
More flubs followed. While criticizing the nine-member Supreme Court to a newspaper editorial board, he referred to "eight unelected and frankly unaccountable judges" and struggled to come up with the name of Justice Sonia Sotomayor, then called her "Montemayor." He urged college students in New Hampshire to support his candidacy, "those of you that will be 21" on Election Day, though the voting age is 18.
The widespread criticism of those performances and his rivals' attacks on his immigration and vaccination policies led to a significant drop in support.