The Italian succeeds Guus Hiddink, whose short stint at Stamford Bridge ended after Saturday’s FA Cup final victory over Everton.
Ancelotti, who has long been linked with the Stamford Bridge post, left AC Milan by mutual consent on Sunday.
Former Champions League winner Ancelotti has agreed a three-year contract with the Blues and will officially take charge on July 1.
A statement on the club’s website, www.chelseafc.com read: “Carlo was the outstanding candidate for the job.
“He has proved over a long period his ability to build teams that challenged for, and have been successful in, major domestic and European competitions.
“He also had a highly successful playing career in those competitions and therefore brings unparalleled all round experience to the job.”
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Mark, South Manchester (01/06/2009 at 10:50)
Goodbye Hughes - 2 wasted years!!