Beilein replaced Tommy Amaker, who was fired on March 17. Amaker had spent six years with Michigan, compiling a 109-83 record.
Beilein comes to Michigan from West Virginia, where he had coached for five seasons. His most recent team emerged as champions of the NIT.
"I am very pleased to announce John Beilein as our new head coach for the men's basketball program," Michigan Athletic Director Bill Martin said. "He is an individual with a great knowledge of the game. He is a proven winner. He is an extraordinary teacher of the game. He is a great basketball coach."