The club confirmed that the 65-year-old responsible for one of the most outrageous success stories in modern football had signed a two-year contract in what it described as a "nice coup by the Nantes directors."
It will be Ranieri's second stint in France after he led AS Monaco out of the second division in 2012-13 and then to second place in Ligue 1 the following season.
Ranieri replaced Portuguese Sergio Conceicao, who led Nantes from the relegation zone in December to a seventh place finish this season but then resigned to take charge of Porto in his homeland.
The well-travelled Ranieri has coached eight different clubs in his homeland, including Juventus, AS Roma, Inter Milan and Napoli, plus Atletico Madrid and Valencia in Spain, Chelsea and Leicester City in England and the Greek national side.
Ranieri was sacked by Leicester in February only nine months after leading them to the Premier League title.
(Writing by Brian Homewood in Berne; editing by Mark Heinrich)
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