The 49-year-old Meulensteen, who spent 11 years working under Alex Ferguson during two spells at Manchester United, had previously been linked with the vacant managerial post with Fulham's London Premier League rivals Crystal Palace.
Fulham have made a poor start to the season and are 18th in the 20-team standings, having lost their last three matches.
In a statement on their website (www.fulhamfc.com), the club said: "Fulham Football Club is delighted to announce the appointment of Rene Meulensteen as head coach.
"Meulensteen joins the club with immediate effect working alongside manager Martin Jol."
Fulham's chief executive officer, Alistair Mackintosh added: "We're all delighted to welcome Rene to Fulham. There was always going to be a battle for Rene's services and, with the assistance of our chairman Shahid Khan, we've been able to bring one of the best coaches in the world to Fulham."
Meulensteen said: "I was impressed by the vision of Shahid Khan and (chief executive) Alistair Mackintosh.
"I've spent many hours talking with Martin Jol and we share a vision of how football should be played and how players should be developed.
"It's our job to make sure we can bring this vision to life on the pitch for the fans."
Meulensteen's last job was in Russia in July at Anzhi Makhachkala who he joined as assistant coach to fellow Dutchman Guus Hiddink. However, Hiddink left the club two games into the season after which Meulensteen only lasted 16 days as manager.
(Reporting by Mike Collett; Editing by Ken Ferris)
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