The 44-year-old had emerged as the leading candidate to take over at The Amex after Chris Hughton was sacked earlier this month and the formalities of the deal were quickly completed after Brighton triggered his release clause at his previous club Swansea.
Potter has put pen to paper on a four-year contract with the Seagulls and will be joined on the south coast by Billy Reid, Bjorn Hamberg and Kyle Macaulay, who were all part of his backroom staff at Swansea.
The former defender, who made his name in coaching during a successful eight-year spell in charge of Ostersunds FK in Sweden, is now looking forward to hitting the ground running with Brighton.
“I was sold by the long-term vision and passion shown by Tony Bloom, Paul Barber and Dan Ashworth,” he said.
“The ideas and plans they have for the future of this football club excited me; I am thrilled and honoured to be a part of it.”
Brighton narrowly avoided relegation this season, as they secured Premier League football for the third-straight year, and Potter is keen to continue making progress with the club that was in the bottom tier of the Football League less than 20 years ago.
“This club has been on an incredible journey and my aim along with Bjorn (Hamberg), Kyle (Macauley) and Billy (Reid), is to ensure the great work that has gone before us is built on, as we strive to cement our place in the Premier League for many years to come,” he added.
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