The winner of the first Tour Down Under takes over from Mike Turtur who is retiring at the end of the 2020 edition in January.
The South Australian said he looks forward to the privilege and challenge of filling one of Australian cycling's most prestigious jobs.
“My appointment to this role really is the pinnacle in my career," the Olympic champion said.
"I have lived my life and career with the international cycling community, so this is a defining professional and personal moment for me."
“I’m excited that I will be delivering a race in my hometown, with one that I competed in, won and have watched grow its cycling participation and fan-base over the years.”
“I am looking forward to developing my vision, and a creative race that will lead to the ongoing growth of the men’s competition and to the overall race itself.”
SA Tourism Minister David Ridgway announced the news earlier today.
“Stuart is a proud South Australian, and an international professional cyclist who comes to this role with significant endorsements from the international cycling community," he said.
"Having Stuart working closely with Mike Turtur this year will provide him with a strong platform and transition on which to build his own style of race for 2021.
“The appointment of a home-grown cycling legend ensures the Santos Tour Down Under will be passionately guided into its next era, after the extraordinary leadership of Mike Turtur for more than two decades.”
The outgoing race director Mike Turtur welcomed the appointment for the race's future.
“We needed the right person, experience, fit, and someone who had an appetite to deliver a vision and really embrace the race with their own personality and someone ready to put their own stamp on it," Turtur said.
“He has terrific experience, networks and relationships globally, which will also bring new opportunities to the race and for South Australia.”
O'Grady's glittering racing career was capped in 2007 when he became the first Australian to win Paris-Roubaix.
He starts work in his new role in December alongside Turtur who will take a mentoring role through to the 2021 edition.