Johansson, 39, had held the position for three years but decided to move on for the sake of furthering his career.
That created an opening which was quickly filled by Craigan, who played for the Lanarkshire side in two spells between 1995 and 2000 and 2003 and 2012.
The former defender gained 52 of his 54 Northern Ireland caps while plying his trade at Fir Park and turned out 379 times for the club.
Craigan has been in charge of the Irish FA’s under-19s over the last two years and will work alongside manager Ian Baraclough and his assistant Stephen Robinson.
The 38-year-old told the club’s official website: “It’s an honour and a privilege to return to Motherwell for a third time.
“I am very much looking forward to the challenge of working with the under-20s side. There appears to be an excitement about the new season ahead.
“Motherwell, from the outside looking in, seems to be a club very much on the up. The new owner and the new people involved are breathing freshness back into things.
“I have very much enjoyed my coaching experiences so far and I am looking forward to the challenge of working with young players on a more regular basis.
“Ultimately, the under-20s are the bridge between the Elite Academy and the first-team.
“It’ll be my role to ensure our brightest young players are fully prepared to push their way into the first team picture, bringing themselves to the attention of the management team both with their performances at training and in games.”