The trial was the first of its kind in Illinois. Prosecutors were allowed to use hearsay evidence, thanks to a state law that was tailored specifically for this case.
Jurors deliberated for more than 13 hours before reaching a guilty verdict. Peterson, 58, looked straight ahead and did not react as the verdict was read. Her relatives gasped, then hugged each other as they cried quietly.
Savio's death was ruled an accident in 2004, but that changed years later when Peterson's fourth wife, 23-year-old Stacy Peterson, mysteriously vanished in 2007.
Investigators exhumed Savio's body, which had been found in a bathtub with a 2-inch gash on the back of her head. After her body was re-examined, the death was reclassified as a homicide.
Prosecutors had no physical evidence tying Peterson to Savio's death and no witnesses placing him at the scene. They were forced to rely on typically barred hearsay - statements Savio made to others before she died and that Stacy Peterson made before she vanished.
Marcia Savio, Savio's step-mother, was emotional outside the courtroom.
"Finally, somebody heard Kathleen's cries. Twelve people did the right thing, oh thank God," she said.
Peterson had divorced Savio a year before her death. His motive for killing her, prosecutors said, was fear that a pending settlement, which included their $300,000 home, would wipe him out financially.
Prosecutors suspect Peterson also killed Stacy Peterson because she could testify against him in Savio's death, but her body has never been found, and no charged have ever been filed.
Peterson's attorney says he will appeal on grounds that illinois' hearsay law is unconstitutional.
"The whole world has been waiting for Drew Peterson to be convicted. They hate him," said defense attorney Joe Lopez. "It's a very dark day in America when you convict someone on hearsay evidence."
Illinois has no death penalty, and Peterson now faces a maximum 60-year prison term when sentenced Nov. 26.
The Associated Press contributed to this report.