About 60 people attended the 4pm memorial service, lasting just over an hour, in the University of Otago's Marama Hall.
The prize is to be known as the Sophie Kate Elliott Memorial Prize and will be awarded annually for achievement in fourth-year economics.
The Elliott family had made a donation to the university to finance the prize.
Miss Elliott (22) completed an honours degree first class in economics in 2007 and was due to start at the Treasury in Wellington in January.
She died in a violent attack in her family home at Ravensbourne on January 9. Her former lecturer and boyfriend, Clayton Weatherston, has been charged with her murder.
The media was barred from yesterday's service. University student services director David Richardson said counselling staff had advised it would be ‘‘inappropriate'' for media to attend. It was a chance for staff and students to grieve, he said.
‘‘This is the university's way of showing its respect.''
Three staff from the university's economics department spoke at the service, as did Otago University Students Association president Simon Wilson, three friends of Miss Elliott's, her parents Lesley and Gil and St Hildas Collegiate School principal Melissa Bell.
Prayers were spoken and the song More than Words was sung by the gathering.
Mr Elliott said afterwards that the service had followed much the same format as his daughter's funeral in January. Many pictures were shown and music was played, he said.
Following the service, Mrs Elliott unveiled a plaque bearing Sophie's name and Mr Elliott turned soil on the ground beneath a cherry blossom tree that had been planted in the university in grounds in their daughter's memory.
