The 44-year-old succeeds former team-mate Robert Page, who was dismissed from his role in June.
Cardiff-born Bellamy won 78 Wales caps and captained the side between 2007-2010.
The former Norwich, Liverpool, Newcastle and Man City striker had previously helped coach Wales age-grade sides but, having turned down the chance to take his first steps into frontline management with Oxford in 2018, Bellamy’s breakthrough will now come at the highest level.
Last week Osian Roberts, who worked as assistant to Chris Coleman at Euro 2016 and technical director at the FAW, ruled himself out of the running. Roberts, who helped to guide Como to Serie A last season, said the FAW expressed an interest in his services.
Former France forward Thierry Henry and Georgia boss Willy Sagnol were also among those linked with the position.
It is understood though that Bellamy – who just lost out on the job in 2017 when Ryan Giggs was appointed impressed the FAW hierarchy when he was interviewed in the north of England last week.
Bellamy takes up the role having left Burnley, where he had been acting head coach before Scott Parker’s appointment last week.
Parker was keen to work with the Welshman, but Burnley chairman Alan Pace said Bellamy leaves with the blessings of everyone at the club.
“I want to thank Craig for all his hard work during his time at Burnley and wish him the best for his new position as Wales manager,” said Pace.
“Craig has been a very important part of our wonderful journey the last two years. I’ve admired his leadership, knowledge, and passion.
“I am certain that he will continue to find success in his new role, and I wish him the very best of luck.”
Speaking on landing the role Bellamy said: “It’s an incredible honour for me to be given the opportunity to lead my country and it’s the proudest moment of my career.
“It was always my ultimate dream to become the Cymru head coach and I am ready for the challenge.
“I will give my full commitment to develop this team and I am passionate to bring continued success into Welsh football. I can’t wait to get started with our Nations League games in September.”
The FAW’s Chief football officer, Dr. David Adams, said: “We undertook a thorough recruitment process for the new men’s national team head coach and Craig was identified as the standout candidate.
“We are all looking forward to the Nations League games and working with Craig to deliver success for Welsh football.”
Bellamy, will now get the chance to lead the side in qualification for the 2026 World Cup with his first game as Wales manager a Nations League home tie against Turkey on 6 September, followed by a trip to Montenegro on 9 September.
[Lead image: Wikimedia / Creative Commons 2.0]
