Larkham had announced in October that he would leave the Canberra side at the end of the campaign to take up a full-time assistant coaching role with Australia.
McKellar has been at the twice champion Brumbies since 2013 when he was appointed defence coach and said he was looking to bring in new talent to the club.
"We have lots of young talent at the club and are in the process of looking to consolidate our playing resources for next season," he said in a team release.
"We are already preparing for the 2018 season in terms of new acquisitions that will help keep the Brumbies at the forefront of Australian rugby."
The Brisbane-born 40-year-old McKellar would ensure "continuity" at the Brumbies, the best performing of Australia's five Super Rugby teams in recent seasons, said club chief executive Michael Thomson.
"In Dan we have appointed a coach who is well versed in the traditions and heritage of Brumbies rugby," Thomson said.
The Brumbies can seal top spot in the Australian conference and a berth in the playoffs if they beat the Melbourne Rebels at home on Saturday and the rival New South Wales Waratahs lose their away match to the Chiefs.
(Reporting by Ian Ransom; Editing by Ken Ferris)
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