Nagelsmann, a youth coach at Hoffenheim, had agreed in October last year to take over next season.
But the unexpected resignation of Dutchman Stevens, who was supposed to have been in charge until the end of the current season, over health reasons on Wednesday paved the way for Nagelsmann to take over earlier than scheduled.
Nagelsmann faces an uphill task to preserve Hoffenheim's Bundesliga status as they are languishing in 17th place in the 18-team league.
"Julian... can shoulder this responsibility (and) he will provide new inspiration to the team," Hoffenheim sports director Alexander Rosen said in a statement.
Briefly a senior team assistant coach during the 2012/13 campaign, Nagelsmann led the Hoffenheim youth team to the 2014 German title.
Despite lacking the coaching licence, he received the green light from the FA to take over the senior team with his final exams set for the coming weeks, the club said.
(Reporting by Karolos Grohmann, editing by Pritha Sarkar)
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