Ranieri had been linked with Manchester City, after he resigned as Parma coach on Thursday after saving them from Serie A relegation.
Ranieri will replace Didier Deschamps, who quit the Bianconeri after leading them to promotion.
A club statement said of Ranieri: “An authoritative choice and one adapted to the club’s objectives and tradition.
“He is a man of international experience and vision, in position to carry out the board’s sporting project.”
