The appointment of Sharif, who was promoted to four-star general with the announcement, ends months of speculation about who would succeed Kayani. He will assume the leadership post Friday.
Dawn newspaper reported Pakistani Prime Minister Nawaz Sharif (no relation to the new army chief) approved the appointment announced by the Defense Ministry.
Separately, Lt. Gen. Rashad Mahmood was appointed chairman of the Joint Chiefs of Staff Committee. Mahmood also was promoted to four-star general.
Raheel Sharif most recently served as the army's inspector general for training and evaluation. Mahmood was chief of the general staff.
Sharif's selection as army chief indicated he was picked over Lt. Gen. Haroon Aslam, currently the most senior officer, Dawn reported.
The army chief post is regarded as the most powerful in a country that was under military rule for about half its independent history dating back to 1947.
The Wall Street Journal said General Sharif, believed to be close to the prime minister's family, has never served in the Military Operations Directorate, the training ground of all previous chiefs.