Williams, 55, replaces Tim Walton to work with a Rams defense that was 15th in total defense last season. The Rams were ninth-best against the run and 19th in pass defense.
Williams spent last season with the Tennessee Titans as senior assistant/defense, helping a team that was 14th in total defense.
"I am excited about coaching this defense," Williams said of St. Louis. "I would like to thank [Rams Coach] Jeff Fisher and the Rams organization for this opportunity and I am looking forward to getting to work and helping our defense become one of the best in football."
Among the team Williams previously coached was the 1997-2000 Houston/Tennessee franchise, coached by Fisher.
In 15 seasons as a defensive coordinator or head coach, Williams has had seven Top 10 defenses, including at New Orleans.
He was suspended for the 2012 season after an NFL investigation determined the Saints operated a bounty system that allegedly paid defensive players bonuses for injuring opposing players.