The 47-year-old has signed a three-year contract after the relegated Black Cats were given permission to speak to him on Thursday and will meet his players for the first time on Friday before flying off to Austria with them for a pre-season training camp.
A club statement said: “Sunderland AFC is delighted to welcome Simon Grayson as the club’s new manager. Grayson moves to Wearside after putting pen to paper on a three-year deal with the Black Cats.
“A seasoned manager who has taken charge of over 600 games, Grayson has vast experience of building and improving teams he takes charge of. He arrives at the Stadium of Light after four years at Preston North End, where he took the club from the lower reaches of League One into the Championship.”