Monaco's Portuguese coach Leonardo Jardim (L) speaks to Monaco's Russian midfielder Aleksandr Golovin (back) during the French L1 football match between Monaco (ASM) and Nimes (NO) on September 21, 2018, at the Louis II Stadium in Monaco.
The 41-year-old has signed a three-year deal with the Ligue 1 side, and will be joined by Benfica U23 coach Joao Carlos Valado Tralhao and Arsenal academy coach Patrick Kwame Ampadu - who is the father of Chelsea's Ethan Ampadu.
Henry, is a former Monaco player, has now left his role as Belgium's assistant coach to take up the head coach role at Monaco.
Monaco is now three places from last position in Ligue 1, France's top football league, and fired manager Leonardo Jardim on Thursday.
Henry began his senior playing career with Monaco in 1994, during which time he played under future Arsenal manager Arsene Wenger.
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Henry knows Monaco well having graduated through the youth system and played for the Principality club between 1993-99.
"First of all, I thank AS Monaco for giving me the opportunity to coach the team of this club which is so special to me", Henry said.
An eight-year spell with Arsenal - where he won two Premier League titles - saw him become the club's all-time leading scorer with 228 goals, while he also won the Champions League during his three-year stint with Barca.
Vadim Vasilyev, Monaco vice president and CEO added: "His knowledge of football, his passion for the game, his high standards and his commitment to our colours make his nomination a reality". He can count on our trust and all our support to bring a new dynamic to the team and carry out its mission'.