Henry's first foray into management was an ill-fated, 20-match spell with former club Monaco, which ended in January with Monaco in the relegation zone.
But the Arsenal and France great has now returned to full-time management with the MLS club, signing a two-year deal, with the option to extend for another year.
'Go back to watching baseball': Zlatan confirms LA Galaxy exit
Following a glorious career in European football, Henry wound down his playing days in MLS with New York Red Bulls, representing the club from 2010-2014, with a brief loan return to Arsenal in 2012.
“It’s an honour to coach the Montreal Impact and return to MLS,” Henry said.
“It’s a league I know well, in which I had some very nice moments. To be in Quebec, in Montreal, which has an enormous multicultural heritage, it’s extraordinary. I’ve always kept an eye on the club and now I’m here.”
Henry's first steps into management came via coaching roles with Arsenal's youth teams and the Belgium national team, working alongside Roberto Martinez.
His difficult time in Monaco leaves Henry with something to prove in the world of coaching. Montreal Impact compete in the Eastern Conference in MLS and last season came ninth out of 12 clubs.
“We are extremely happy to announce the nomination of this legend of the game,” said Montreal Impact president and CEO Kevin Gilmore.
“Henry will bring a new energy to our club. He shares our vision to elevate this club and will help us achieve our goals on and off the field. He is a competitor and a leader who has proven himself at the highest level throughout his career. He now brings these qualities with him to Montreal, a place he wants to be.”
'If I leave, nobody will remember what MLS is' - Ibrahimovic
Rooney leaves MLS on a low as DC thrashed 5-1