The 42-year-old, who is a product of the club's youth side, has been the outgoing coach's right-hand man for the past five years but will now take full control of the first team
After months of speculation, Guardiola confirmed on Friday that he will not be extending his contract when it expires at the end of the season.
The Catalan giants have now, in the interest of continuity, decided to turn to his right-hand man.
"When Pep said that he would not stay, at first we couldn't believe it," sporting director Andoni Zubizarreta admitted to reporters at a press conference to announce the former Spain international's imminent departure.
"But he always told me that the most important thing is to continue with the game. Who to replace him with was a difficult decision.
"One day I asked: Tito has been working here with us, so why not Tito? He represents the game and is analytical.
"He puts in all the hours until he sleeps and he has the personality that we need to lift us. He's different to Pep, but Tito's the one.
"We've always looked in house. We have Tito - it's simple. We needn't go out on the market."
Guardiola, meanwhile, believes that the club have made the right decision in appointing a man he has been working alongside for the past five years, dating back to their time in charge of the Barca B team.
"You can expect the best from Tito," he enthused. "He's more than skilled and the players know him. I think the club made a great choice.
"The decision to appoint Tito was made by Zubizarreta. He just asked my opinion and I said he could do the job.
"When Tito asked me my opinion, I said he should see what he felt about it and that if he felt strong enough, he should get in there."
Guardiola also humbly claimed that the remarkable success that the Catalans have enjoyed over the past four seasons was as much down to his assistant as it was him.
"I was just the voice of the ideas Tito and I developed together," the former Blaugrana midfielder claimed.