Marcelo Bielsa was well regarded at Leeds (AFP)
Bielsa, who was sacked by Leeds United in February last year, takes over from Diego Alonso after he oversaw a disappointing World Cup campaign which ended in the group stage.
"The man from Rosario will take the reins of the squad after his tenure at Leeds, a club which he managed between June 2018 and February 2022," Uruguay's football association said in naming Bielsa to the post.
Bielsa will be presented to the media on Wednesday.
He has had a long career in football management, coaching a dozen teams including his native Argentina, Chile, Athletic Bilbao, Marseille, Lille and most recently Premier League Leeds.
He is still revered at Leeds for taking them back into England's top flight and engineering an exciting, attacking brand of football.
But his team were also shaky in defence and he was sacked under the threat of relegation.