The 29-year-old, who led Palace to Premier League safety this season, replaces veteran defender Lucas Neill as skipper.
"To be handed the responsibility of captaining my country at the World Cup is humbling, yet incredibly exciting," said Jedinak, who is recovering from a groin injury picked up in the Eagles' final game of the season.
"Just pulling the Socceroo shirt on fills me with pride but to be leading out my country and these players at the World Cup on behalf of all Australians is special."
Jedinak took the Australia armband for the first time in a friendly against Ecuador in March but has now been handed the job on a permanent basis by coach Ange Postecoglou.
"It is a privileged position and an accolade he richly deserves after the incredible job he has done at Crystal Palace in the toughest club competition in world football, the Premier League," said Postecoglou.
"Mile Jedinak embodies everything that is great about Australian football and Australia as a nation.
"He has risen to the top of world football and done it the hard way from humble beginnings where he has battled and believed in himself to overcome the odds with an enormous work ethic and passion for what he does.
"I have no doubt he will lead the team with distinction in Brazil."
Jedinak, who has earned 43 caps, will be assisted by experienced duo Tim Cahill and Mark Bresciano, who have been selected as his vice-captains.
Australia are taking an inexperienced squad to the tournament following the international retirements of goalkeeper Mark Schwarzer, forward Harry Kewell and midfielders Brett Emerton and Brett Holman, while Neill was left out of the provisional 30-man squad.
The Socceroos will face defending champions Spain, the Netherlands and Chile in Group B.