The Villans, who sacked coach Tim Sherwood last week, sit rock bottom of the English standings with just one win from their opening ten fixtures, and turn to the former Olympique Lyon manager in the hope of climbing up the table.
"For the past year we have been working purposefully to transform the Club in order to build a successful organisation that can compete and succeed in the Premier League,” Aston Villa Chief Executive Tom Fox told the club's official website.
"Finding a manager who shares and believes in our vision and has the ability to bring it to life through performances on the pitch is essential. We are confident that Rémi is the manager who can deliver the best from the current squad and help set the club up for future success.”
The 49-year-old Frenchman, who spent three years in charge of Lyon, winning the 2012 French Cup, says he is thrilled to have joined the English club, yet is aware of the difficult challenge the club faces.
"It is an unbelievable honour to be the manager of such an illustrious football club,” he said.
"I've had extremely positive meetings with both the owner, Randy Lerner, and Chief Executive Tom Fox. They have ambitious plans for the Club and I'm excited that they have turned to me to help them realise them.
"Obviously we have a difficult task in front of us but I'm looking forward to the challenge with the support of everyone who loves Aston Villa."