Giggs, 44, played 64 times for Wales between 1991 and 2007 but, despite a trophy-laden club career, did not appear at a major worldwide finals.
The 44-year-old, who was capped 64 times by Wales, says his prestigious playing career is no guarantee of success in his new job.
He will replace Chris Coleman - now manger of Sunderland - who left the post after failing to take Wales to the 2018 World Cup in Russian Federation, having previously reached the semi-finals of Euro 2016 in France.
"We are extremely delighted to see Ryan appointed as the national team manager", said FAW chief executive Jonathan Ford in a statement.
"I don't think he played a friendly for around nine years, until 2000".
Giggs has signed a four-year contract after he beat out Craig Bellamy, Osian Roberts and Mark Bowen during the interview process.
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He takes over from Chris Coleman, who left the role in November to take over as manager of Sky Bet Championship side Sunderland.
I enjoyed my assistant role at Man United but I was itching to get back into football.
'It opens doors, but so many times it's been said that if you've had a good career as a player it doesn't necessarily mean you'll be a good manager, ' he said.
Giggs' first game in charge will be in the 2018 China Cup against the hosts on 22 March in Nanning.
"So good luck trying to get the players together".
Ryan Giggs is weighing up an approach to make Paul Scholes a part of his Wales backroom staff. But Coleman's departure came on the back of Wales failing to qualify for this summer's World Cup in Russian Federation.
Giggs will be hopeful that he can revitalise the squad after a disappointing World Cup qualifying campaign that ended with Ireland pipping Wales to the play-off places in the final round of matches.