The former Argentina coach, nicknamed "El Loco" (the Crazy One) quit Marseille after just one league game in the 2015-16 season, citing conflict with the club's management.
Bielsa, 61, also left Italy's Lazio abruptly last year only two days after being appointed.
"Marcelo Bielsa is undoubtedly one of the most respected and most influential coaches in the world, and being able to attract him to LOSC is a huge satisfaction," Lille said in a statement on Sunday, adding that the Argentine had agreed a two-year contract.
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Under Bielsa, who also coached Chile from 2007-11, Argentina won the South American qualifiers for the 2002 World Cup but failed to get past the first round in the tournament.
In 2004, they won the Olympic gold medal before Bielsa resigned after six years in charge and was replaced by Jose Pekerman.
Bielsa will replace Franck Passi, who was named this month as the replacement for interim coach Patrick Collot.
Lille are 14th in Ligue 1, four points above the relegation zone.
Last month, Gerard Lopez, the former president of the Lotus Formula One team, replaced Michel Seydoux as Lille owner after buying 95 per cent of the club's shares.
(Reporting by Julien Pretot; Editing by Ed Osmond)
