Setien has agreed a contract until the end of the 2023/2024 season and will replace Unai Emery, who has left to take charge of Aston Villa in the English Premier League.
Setien earned a reputation for playing an attractive brand of football at Las Palmas and Real Betis but his spell in charge of Barcelona lasted just seven months, ending with an 8-2 humiliation at the hands of Bayern Munich in the quarterfinals of the UEFA Champions League in August 2020.
'Villarreal CF have reached an agreement with Quique Setien for the Santander-born coach to take charge of the Yellows for the remainder of the current season and the entirety of the following one,' the club said in a statement.
The 64-year-old's first game in charge of Villarreal will be against Hapoel Beer Sheva in the Europa League on Thursday.
Villarreal currently lie seventh on the Spanish La Liga table after winning five of their first eleven matches.
Setien will have a tough job on his hands at Villarreal, with predecessor Emery leading Villarreal to Europa League glory in 2021 as well as the Champions League semi-finals last season.
