The Pakistan Cricket Board (PCB) said the 47-year-old will act as the head of a four-man selection panel besides being the director of game development.
The director role encompasses everything from grassroots to first-class cricket.
In his first move, Sohail backed Test and one-day captain Misbahul Haq to retain his spot.
"Misbah has led the team well and I don't need to defend him," said Sohail of the 39-year-old Misbah. "We have to work together and powers matter much less to me than solving problems."
Pakistan has not had a chief selector since the Islamabad high court last month suspended all decisions taken by interim cricket board chief Najam Sethi, whose tenure began in July 2013.
Sethi had appointed former captain and wicketkeeper Moin Khan as chief selector.
Sohail's appointment is the first major decision by Zaka Ashraf who was reinstated as PCB chairman in January, eight months after being suspended by the court over dubious elections.
Sohail, opening left-handed batsman, had played 47 Tests and 156 one-day internationals for Pakistan and was part of the World Cup winning team in 1992. He said he will do his best to lift the team.
"Pakistan team is doing well in one-day matches and Twenty20 and I will try to further lift that as well as our showings in the Test matches," Sohail told reporters.
Aamir's first task will be to select the national squad for the Asia Cup to be held in Bangladesh from February 25 - March 8.
This will be Aamir's second tenure as chief selector, having held the post in 2003.
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His selection is purely on merit reserved for PML-N quota only
Good to finally see some positive move by the PCB. A step in the right direction. Aamir understands the game at the grass root level and appears quite passionate about providing a steady supply of fresh talent to Pakistan cricket.
His role as Director game development should help him to nurture and groom some quality cricketers. Hope he stays focussed on the job and get its done the right way. Good choice PCB. Well done.
Time for Afridi to pack his bags.
Great to see Aamir Sohail back as Chief Selector. Back in 2003, he was one of the key reasons we were able to rebuild the team and chuck out a lot of non performing seniors. I am also glad to see that we have a Chief Selector who is not only educated, but is also a former Captain and key member of the 1992 world cup winning squad. I hope we finally see the end of self-promoting ex-cricketers like Mohsin Khan, Moin Khan, Iqbal Qasim etc from the PCB once and for all. We need more people like Aamir Sohail as part of the national cricket set up, whether it be as a coach, selector or member of PCB. Best of luck Aamir !
Very promising talks coming out. The administrators could be people with management experience. However, the selectors should all be former players with extensive playing experience not just lightweights who do not have much handson experience or record.