Rennie has signed a four-year deal to coach Australia through to the France tournament and will arrive in Australia at the end of his current contract with Scottish side Glasgow, in June.
The former Chiefs coach has long been touted as the front runner to be Michael Cheika's successor.
Rugby Australia chief executive Raelene Castle said in a statement appiontment was a "coup" for Australian rugby and the culmination of a six-month search for Cheika's replacement.
"This is a massive coup for Australian Rugby, Dave Rennie was the clear standout candidate for the job, and we're thrilled to have secured his services," she said.
"Dave's coaching philosophy focuses equally on football and team culture, the key pillars to building sustainable success in any team.
"He has a proven track record in the Northern and Southern Hemisphere.
"Given incumbent head coach, Michael Cheika had indicated in early 2019 the possibility that he would not seek re-appointment for the role, we needed to identify a list of candidates that would be available to us, and suitable to work within our new High Performance framework.
Rennie will stay with Glasgow until the end of the current Pro14 season, which concludes in June.
Rennie has been open about his interest in the Australian job but there was some doubt cast on his recruitment when it was revealed the All Blacks had also contacted him to interview for their national job.
Rennie said he felt he could "make a difference" in Australia.
"My wife, Steph and I have spent the past few months considering our future and we're really excited about our decision," he said in a statement.
"I've been coaching professionally for over 20 years and wherever I've gone, I've immersed myself in the community and culture. I believe I can make a difference here
"There are some outstanding young men coming through the schools system. I want to create a strong connection with the Super Rugby and national age grade coaches and help them achieve their goals, which will benefit the Wallabies in time
"When I met Raelene Castle, I was really impressed with her plans for the future of Australian Rugby and I'm keen to be part of that."
Rennie is the second New Zealander to coach the Australian, with former All Black Robbie Deans having been at the helm from 2008-2013.