Former Durham Chief Constable Jon Stoddart will lead the new inquiry, which will focus specifically on the 96 deaths of Liverpool fans at the FA Cup semi-final in 1989.
The move comes after a damning report from the Hillsborough independent panel laid bare a cover-up which attempted to shift the blame for the tragedy on to its victims.
Home Secretary Theresa May said: "I am determined to see a swift and thorough response to the findings of the Hillsborough Panel to deliver justice for the 96 football fans who died and the families who have fought so hard on their behalf."
Mr Stoddart will be able to recruit investigators and staff to his team, but he will not be allowed to employ officers or former officers with any prior connection to the Hillsborough disaster.
He is also unable to recruit any officers or former officers who worked in the West Midlands, South Yorkshire or Merseyside police forces.
Mr Stoddart will also work closely with the previously announced Independent Police Complaints Commission (IPCC) investigation into police conduct in the aftermath of the disaster.
He said: "I am aware of the great significance and personal responsibility which comes with leading this criminal investigation.
"My first priority is to meet with as many of the families as possible and to establish a working open relationship with them throughout the investigation.
"I have held a number of meetings already and have been struck by the families' humility and steadfast determination to see justice delivered for their loved ones.
"My role is to ensure that we determine exactly what happened in the lead-up to and on the day of the disaster and establish where any culpability lies.2
The announcement was released ahead of a High Court decision to quash the original accidental death inquest verdicts for the 96 fans killed in the crush at Hillsborough.
The Hillsborough independent panel report triggered a raft of apologies from the likes of Prime Minister David Cameron and former Sun editor Kelvin MacKenzie.
Mr MacKenzie was the editor of The Sun when it ran a front page story blaming fans for the disaster.
It also ultimately led to the resignation of West Yorkshire Chief Constable Sir Norman Bettison, who was a chief inspector with South Yorkshire Police at the time.
The panel's report found there were clear operational failures in response to the disaster and up to 41 fans could potentially have survived.
It also found the then chief constable of South Yorkshire, Peter Wright, and his officers, with the help of local Tory MP Irvine Patnick, sought to cover up the failing.
The Liverpool supporters died in a crush at Sheffield Wednesday's Hillsborough stadium on April 15 1989 where their team were to meet Nottingham Forest in an FA Cup semi-final.
The new investigation could lead to criminal prosecutions and for serving police officers it could also lead to misconduct proceedings, the Home Secretary said in a written ministerial statement.
Mr Stoddart will principally investigate the deaths at Hillsborough, while the IPCC will principally investigate the aftermath of Hillsborough.
The investigations will be integrated, working from the same office in Warrington, Cheshire.
Mr Stoddart, who recently retired as Chief Constable of Durham Police, is being appointed to the Metropolitan Police as an Assistant Commissioner - a rank equivalent to chief constable.
In addition to announcing the new investigation, Mrs May also revealed that a Liaison Board will be established to bring together all organisations working on behalf of the Hillsborough families.
The deputy chair of the Independent Police Complaints Commission, Deborah Glass, said: "Today's announcements are welcome news.
"The complex and multi-faceted investigations into the Hillsborough disaster are taking shape.
"The IPCC has been making progress in laying the foundations for our independent investigation into the aftermath and the future investigation into the tragic deaths of 96 people.
"The appointment of Mr Stoddart to lead the investigation into the deaths is a crucial step. His investigation will be into a wide range of agencies outside of the IPCC's remit, but, in order to ensure independence from the police service, we will be managing the element which will look at the actions of police officers in relation to the deaths of the 96 men, women and children. This means that the IPCC will have direction and control of this part of the investigation.
"The two investigations will be closely integrated and will be based in the new offices the IPCC has secured in Warrington. They will share a major incident room with full access to the underlying documentation, and will offer a single point of contact for liaison with the families.
"This is not going to be a quick and easy process. But we now have a clear path ahead, with all the investigative and prosecutorial bodies working in a co-ordinated way to complete the full picture for the families of those who died, those who were injured and those who were traumatised by the terrible events at Hillsborough."
When asked about the new police investigation, Trevor Hicks, chair of the Hillsborough Family Support Group, said he was encouraging all sections of the investigation to work together.
The decision to lead the new investigation was announced while Mr Hicks and the other friends and families of the victims were inside the Royal Courts of Justice.
He said: "We were aware it was a possibility, but we hadn't heard it said yet.
"We've said all along that we wanted joined-up writing, if you like, we want them all to work together. There's a common cause and that's justice for the families and how we get that."
He added: "Obviously the mechanics of that will take a fair bit of working out, and we know that we're in for months if not years of hard work. But we've been here before; we're not going anywhere."
Mr Hicks' ex-wife, Jenni, who lost their teenage daughters Sarah and Victoria in the incident, said "accountability has to come now".
She added: "After the truth we had on September 12, it has to be followed up with accountability, and I think today is the first step of that, which is brilliant."
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