Chelsea was in the market for a new manager ever since the departure of Carlo Ancelotti in May and they have now found its man. The 33-year-old Villas-Boas resigned as Porto coach on Tuesday and now returns to the club where he previously worked at Chelsea as Jose Mourinho's assistant.
"Andre was the outstanding candidate for the job. He is one of the most talented young managers in football today and has already achieved much in a relatively short space of time," a statement on the Chelsea website reads.
"His ambition, drive and determination matches that of Chelsea and we are confident Andre's leadership of the team will result in greater successes in major domestic and European competitions.
"Andre will bring his coaching experience back to a club he is already very familiar with, having previously worked here for three years. He has always been highly regarded at Chelsea and everyone here looks forward to welcoming him back and working with him."
After his appointment, attention will now turn to which players Villas-Boas and the club's directors will look to bring in ahead of the new campaign.
Chelsea has already been linked with some of Villas-Boas' former Porto stars, such as Colombia striker Radamel Falcao, a player who could reportedly follow his former boss to west London this summer.