The children, who were aged 4 and 6 at the time of the incidents, were in the man's care at a foster home in Stockholm.
“It was the sentencing that I had insisted on, so I am satisfied with the ruling,” said prosecutor Isabelle Bjursten to the TT news agency.
The man confessed to possessing child porn, which he at times showed to the young victims while he masturbated.
He also photographed some of his own sexual crimes.
Apart from being convicted of rape, he was found guilty of child pornography crimes and sexual molestation.
The court said in a statement that the man's behaviour was "particularly reckless" as he had taken advantage of the children's defenselessness.
Meanwhile, the 61-year-old's lawyer believes the punishment is unreasonably harsh.
“I think eight years is far too long, so I'm recommending that he appeals the whole thing,” Palle Källström told TT.
The two children will receive 375,000 kronor ($56,200) in damages.