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In a surprise victory Wednesday night, the Houston-based Chloe Dao was the only designer to escape Heidi Klum's auf weidersehen and be crowned the winner of Project Runway.

Dao, 34, beat out fellow finalists Santino Rice, the designer viewers loved to hate, and Daniel Vosovic, the recent FIT grad long considered the favorite to win.

"I'm still shocked that I was chosen," Dao told the Associated Press.

In addition to joining the ranks of season one winner Jay McCarroll, Dao will receive $100,000 in seed money to start her own fashion line and a mentorship from a Banana Republic design team. Her designs, as well as her partnered model, Grace, will be featured in a fashion spread of an upcoming issue of Elle magazine. She also drove away with a $24,000 Saturn convertible.

Dao snagged the title of "America's Next Great Fashion Designer" after the trio's final challenge, the staging of a 12-outfit show in the largest tent at Olympus Fashion Week, held in New York last month, for which the designers were given five months and $8,000 to prepare.

Of course, a straightforward task, no matter what the scope, is never a straightforward task on reality TV. Just two days before their runway debuts, the designers were required to craft a 13th outfit to be shown as part of their collection. Each finalist was allowed to choose a previously ousted designer to help with the construction: Vosovic chose Nick Verreos, Rice picked Andrae Gonzalo, and Dao went with Diana Eng.

Dao's final product, a collection of voluminous and structured gowns in heavy fabrics, deemed her "fantasy line," seemed to be the judges' as well.

Supermodel hostess Klum, designer Michael Kors, Elle's Fashion Director Nina Garcia and guest Debra Messing served as judges for the final runway challenge.

The group heralded Dao's designs as having a cohesiveness the others lacked, and praised her for "always thinking of a woman's body."

By comparison, the group found Rice's designs too safe and in several cases ill-fitting. As for Vosovic, who said his inspiration was military with Asian undertones, the judges just didn't see it. They told him that while he showed the most range, the line lacked unity.

After much deliberation, the judges and designers returned to the runway, with Rice the first to receive the boot despite his earlier boast that he was "not just good TV, I'm a great designer."

The judges then crowned Dao the winner of the show's second season, but not before praising Vosovic for his "impeccable taste" and strong, sophisticated designs throughout the competition. Before stepping off the runway, Vosovic, 24, fielded a job offer from Kors.

The victory was a shock for even Dao, who upon hearing her name, said, "Are you kidding me? No way!"

"We loved what you did," Klum said.

Dao, who earned a degree in patternmaking and subsequently was on the receiving end of a scathing insult from Rice, declaring her a "brilliant patternmaker" but uninspired and uncreative designer, finally had a rebuttal for the show's villain.

"I can only say that I guess you're wrong!" Dao told the AP. "I can't help it if I had skills, honey."

Dao, who was criticized throughout the competition for her lack of showmanship and "passion for fashion" said she planned on staying in Houston where she hopes to expand her boutique, Lot 8--so named for her and her seven sisters--and base her line from there.

"It's about me figuring out how to do this right, where I can balance having a life also," Dao said.

"People are going to hate me for saying this, but I'm really happy with my life and I'm really happy I'm the winner and I'm really going to try to make something out of it, but am I going to be the next Vera Wang or Ralph Lauren? I don't know."

Despite Dao's not quite gung-ho attitude, and McCarroll's failure to leap into the mainstream, Project Runway may breed a fashion superstar yet.

As expected, Bravo has announced plans for a third season of its ratings-grabbing, Emmy-nominated fashion competition, with Klum again returning as host. The second half of the season's two-part finale drew in 3.4 million viewers, making the runway showdown the most watched telecast in the cable net's history.

"Project Runway is a wonderful inspiration for aspiring fashion designers and the third season is sure to be filled with as much edge and excitement as the first two," said Harvey Weinstein, one of the show's producers.

In other words, look out, Santino.

Open calls will kick off for interested designers in New York, Los Angeles, Chicago and Miami this March.