Mick McCarthy will be unveiled as Republic of Ireland boss on Sunday but he will be replaced by Stephen Kenny after the Euro 2020 finals.
McCarthy has penned a two-year deal while Dundalk manager Kenny will take charge of the Republic's Under-21 side before moving up to the senior post.
It was expected that McCarthy would succeed Martin O'Neill and start a second spell as Republic boss.
That he will be replaced by Kenny has come as a major surprise.
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League of Ireland clubs Derry City and St Patrick's Athletic gave their support for Kenny to be appointed to the top job on Friday.
However, it emerged that McCarthy would get the nod as the FAI sought to make a swift appointment ahead of next weekend's draw for the Euro 2020 qualifying groups.
The 59-year-old, who stood down as boss of Ipswich Town in April, led the Republic to the last 16 of the 2002 World Cup.
He famously had a pre-tournament row with Roy Keane at a training camp in Saipan, which resulted in the Irish skipper leaving the squad.
McCarthy quit later that year after the Republic made a poor start to the qualifying campaign for Euro 2004.
Since then he has been in charge of Sunderland, Wolverhampton Wanderers and Ipswich.
Kenny, 47, has led Dundalk to four League of Ireland titles in the last five seasons.
He started his managerial career with the under-21s at Dublin side St Pat's in 1997, before taking charge of League of Ireland clubs Longford and Bohemians.
Kenny has also had spells at Derry, Dunfermline Athletic and Shamrock Rovers.