The large round by Oak, which was led by Palo Alto, Calif.-based venture capitalist Fred Harman, will give the popular online news and blog site a valuation of just “south of $100 million,” a source said.

The new funding, the Huffington Post’s third, will be used for expansion of its offerings and the hiring of editorial and business talent.

“There is an inevitable shift from offline to online with people increasingly getting their news media online, and this election proved how powerful the Huffington Post could be,” said Harman (pictured here), in an interview with BoomTown. “And I think the post-election perception of the Huffington Post has changed in the eyes of advertisers to being a key mainstream news site.”

Indeed, the Huffington Post–which is now billing itself as ‘”The Internet Newspaper”–has been hitting on all cylinders during the current election season.

And it hopes to continue building that momentum into the Obama administration, which will give the liberal-leaning site a lot of advantages in coverage.

The Huffington Post has also become a powerful news aggregator, much as the more conservative Drudge Report has, sending traffic all over the Web from its site by linking with a variety of online sites. It also has a strong offering of high-profile bloggers.

But the site’s leaders are also hoping its traffic strength will allow it to be as strong in arenas outside of its flagship political arena, including in business, local, “green” and investigative news.

It will also use the money to make acquisitions, the company said in a press release about the funding, which it put out this morning.

It’s certainly a long way from May of 2005, when its high-profile co-founder, Arianna Huffington, was roundly mocked for launching the site. Today, she has seen her power grow as the site’s traffic and influence have.

The site’s namesake operates out of her California-based office in Los Angeles, while the company has its HQ in New York.

The Huffington Post’s traffic in September 2008, for example, quadrupled from a year before to 4.5 million unique visitors, according to comScore (SCOR). That performance made it the No. 1 “stand-alone political blog and news site,” besting Drudge.

“The cycle of print media is accelerating downward and there are not as many companies with a balance sheet and focus to do it right online,” said Harman, who will join the Huffington Post’s board. “The news market is really up for grabs in a lot of ways…and it is a good time for those who are viewed as authoritative.”

But, like a lot of advertising-reliant businesses, the Huffington Post is also facing a tough market and must show it can compete under more dire economic circumstances and build a sustained and profitable business.

This slug of money should give it a lot of room to do so, said Harman, who has invested in several digital media companies, such as Demand Media and Federated Media. He was also one of the lead investors in aQuantive, the digital advertising business that was bought by Microsoft for $6 billion in 2007.

“Who knows how deep this economic situation is going to be,” said Harman, who noted that he and others kept investing in aQuantive through the last Web downturn. “But strong companies that keep investing through a bad cycle can emerge as winners.”

Previous investments in the Huffington Post have totaled about $12 million. That funding has come from Softbank Capital and Greycroft Partners, as well as seed money from co-founder Kenneth Lerer and former AOL exec Bob Pittman.

Funding reports about the Huffington Post appeared about a week ago in the Times of London, with the post claiming a $15 million investment and expansion into investigative and local news.

But the most detailed posts were done by paidContent, which was the first to name Oak as the new investor and said the round was $20 million.

In February, for the first time ever, Arianna Huffington’s liberal political mega-blog and news site, the Huffington Post, has apparently surpassed the longtime mighty blog leader, Matt Drudge of the conservative/populist-leaning Drudge Report, according to recent traffic data reports from both comScore (SCOR) and Nielsen Online. (Both are pictured here.)

According to data from Nielsen Online, for example, the Huffington Post’s traffic–as measured by monthly unique visitors in the U.S., at home and work–has more than tripled since February of 2007, when it had about 1.1 million unique visitors; by February of 2008, unique visitors had risen to 3.7 million.

In that same month, the Drudge Report had 3.4 million (it had 2.75 million in February of 2007).

Data from comScore is different, as measurement data often is, but shows the same trend (see chart below). The Huffington Post jumped from 457,000 unique visitors in the U.S. at all locations, but had risen to 2.3 million in February of 2008.

For Drudge, comScore reported that it had 1.2 million unique visitors in February of 2007 and 1.6 million in February of 2008.

Of course, internal logs at both sites are likely to show much higher numbers than either comScore or Nielsen Online, by a factor of even four or five times.

Sources at the Huffington Post, for example, said that logs show 12 million uniques for the last month, which they attribute to the addition of new vertical sites within the main site, as well as an increased interest in political news and analysis.

In comparison, Drudge’s site notes it had 21.8 million visits in the past 24 hours. But the site does not define this figure, and it is not and cannot be compared to unique visitors.

“We couldn’t be more pleased with our traffic growth and look forward to continuing to build out our brand,” wrote Arianna Huffington in an email, asking about the traffic spike on her site.

(BoomTown sent an email to the Drudge Report’s contact email on its site late last night, asking for a comment about the data, and will post a reply if I receive one.)