The 49-year-old, who was sacked by QPR in November 2012, replaces Tony Pulis, whose seven years in charge at the Britannia Stadium came to an end earlier in May
Hughes will be unveiled by chairman Peter Coates and chief executive Tony Scholes at a press conference at the club's Clayton Wood training complex at 11am.
Hughes replaced Neil Warnock as QPR boss in January 2012, but after keeping the club in the Premier League, the former Manchester United striker was sacked having picked up just four points from the first 12 games of the 2012-13 campaign.
The 49-year-old started his managerial career in charge of the Welsh national team and then ejoyed a successful spell at Blackburn, guiding Rovers to a sixth-place finish in the top flight.
Manchester City hired Hughes in 2008, but the eventual takeover of the club by the Abu Dhabi United group led to his sacking and the appointment of Roberto Mancini.
Hughes' last full season in management saw him guide Fulham to eighth in the Premier League in 2010-11, before resigning the following summer.