Raye, who also will have the title of assistant head coach, is the first notable hire made by Norv Turner, who took over as coach on Monday.
The 56-year-old Raye spent the last two seasons with the New York Jets, holding the title assistant head coach in 2003.
"I've known Jimmy Raye for over 20 years and have always had the highest regard for his football expertise, his ability to teach, his ability to communicate," Turner said. "His wealth of football experience and knowledge are a great addition to the Raider organization."
Raye will fill the role of Marc Trestman, who earlier this week was named quarterbacks coach of the Miami Dolphins.
Turner has yet to say how many assistants on the staff of former coach Bill Callahan will be retained.
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