The 42-year-old, who was sacked as head coach of Bastia in November 2014, will assist the club's vice-president Vadim Vasilyev with sporting matters at the principality outfit.
"I'm very happy to join an important club in French and European football," Makelele told Monaco's official website.
"It's a new phase of my career and I'm convinced that the new role of technical director suits me perfectly and will allow me to keep developing.
"I'm very excited at the idea of working with a coach of the quality of Leonardo Jardim.
"AS Monaco looks at Champions League qualification every year and I'm going to work to help them achieve their objectives."
Vasilyev added: "It's a great pleasure to have a man of the quality of Claude Makelele at my side.
"It was important to have an everyday professional to serve as a link between the sporting group and the club directors.
"This new organisation should help to allow AS Monaco to take new steps and satisfy our long-term goals."