Mr Castro, 44, the grandson of a Mexican immigrant who would be the first Hispanic elected president, served as secretary of Housing and Urban Development under former President Barack Obama and has long been viewed as a rising star in the party. He will seek to position himself as a political outsider with liberal credentials. Announcing his candidature, he said: ”I’m running for president because it’s time for new leadership. Because it’s time for new energy. And it’s time for a new commitment to make sure that the opportunities I’ve had are available for every American.”
One of Mr Castro’s first stops as a candidate will take place on Monday in Puerto Rico, still picking up the pieces after the devastation of Hurricane Maria, where he will attend an event hosted by the liberal Latino Victory Fund.
He made his announcement at Plaza Guadalupe, a landmark in San Antonio’s sprawling west side Mexican-American barrio, a neighbourhood of neat, brightly painted wood framed homes, many on tiny lots and festooned with white plaster Catholic statues.
In summarising his political positions, Mr Castro endorsed “Medicare for all,” which would in effect create a national healthcare plan by allowing anyone to join the public healthcare system.
That policy point is likely to divide Democrats in the primary, with more moderate candidates favouring a less drastic approach.
He used his launch to repeat support of the Black Lives Matter movement. He spoke about the need to address climate change.
Mr Castro, whose grandmother was born in Mexico, has sought to use his family’s personal story to criticise Mr Trump’s controversial border policies.
He said: “Yes, we must have border security, but there is a smart and humane way to do it. And there is no way in hell that caging children is keeping us safe.”
Mr Castro is the second candidate to formally launch a campaign.
Former US Representative John Delaney has been running for more than a year.
US Senator Elizabeth Warren of Massachusetts has formed an exploratory committee and Representative Tulsi Gabbard said Friday that she will run for president.
More than a dozen potential Democratic candidates are exploring a possible run for president in 2020.
Moderates and progressives in the party have been debating about how to best challenge Trump, the likely Republican nominee.
Barack Obama’s former vice-president Joe Biden told a seminar at London’s Chatham House last year he was not one of them – but coyly added: “Yet”.
During his speech Mr Biden also singled out California senator Kamala Harris as a possible contender, while Mr Castro’s fellow Texan Beto O’Rourke has also been urged to run.
Some Democrats believe an establishment figure such as Mr Biden, who can appeal to centrist voters, is the way to win back the White House.
Others contend a fresh face is needed to energise the party’s increasingly left-leaning base.
Mr Castro, who was considered on the short list to be Hillary Clinton’s running mate in the 2016 election, has been out of the political spotlight for the past two years, at a time when politics has become all-consuming across America.
Mark Jones, a political analyst at Rice University in Houston, who has followed Mr Castro’s career, says despite this, his chances of securing the nomination in what is certain to be a crowded field are slim at best.
Mr Jones said: ”Julian Castro shouldn’t be counted out completely.
“That said, his star is definitely not rising anymore, and the sun may be setting on the presidential ambitions of Julian Castro.”
Mr Castro would be the first identical twin elected president.
His twin brother, Joaquin Castro, is a member of the US House of Representatives from Texas. Joaquin Castro’s position on the House Intelligence Committee has made him a frequent public critic of the president.