Embley moved from his role as assistant editor of production on the Daily Mirror to step in for Thomas in November last year.
Thomas, who was editor of The People since March 2003, said at the time he wanted to "pursue other career opportunities".
Sly Bailey, chief executive of Trinity Mirror, said: "As acting editor Lloyd has demonstrated a real grasp of The People's readership and its market.
"He has a clear, modern vision for the title's future along with the right skills to succeed."
The Sunday tabloid's circulation has been in steady decline in recent months, dropping to 646,577 copies in May, according to the ABC. Its six-month average is down 10.91% year on year.
Embley said: "We are facing the circulation challenge head on and with the plans we have in place and the considerable talents of our staff we will ensure The People continues to be a great Sunday newspaper."
Separately, Gary Jones has been appointed as deputy editor of The People with immediate effect to replace Ben Proctor, who is leaving Trinity Mirror today. Jones was previously assistant editor of news on the Daily Mirror.
The People's night editor Matt Clark has been promoted to assistant editor.
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