David Warner, 28, will be the Test group's bad habit commander.
Smith, who skippered Australia in Tests against India amid the last home season when Clarke was sidelined with a hamstring damage, was the regular decision for the position, Cricket Australia said.
"At the point when Michael settled on his choice to resign a week ago it was an extremely clear choice for us to designate Steve as his successor," national selector Pole Swamp said in an announcement.
"He has huge shoes to fill however every little thing about him proposes he is the right man for the occupation. At 26, he is a fine young fellow with remarkable ability, phenomenal initiative qualities and a fantastic personality.
"He is exceedingly respected by the selectors and we compliment him on being delegated to the part on a continuous premise. He ought to be extraordinarily pleased."
Smith, who was generally anticipated that would supplant Clarke and whose arrangement was supported at Cricket Australia's August executive meeting on Friday, will likewise be Australia's T20 chief amid their voyage through the English Isles, because of Aaron Finch's damage.
The meeting likewise supported a proposal that opening batsman Warner serve as Smith's delegate in Test matches and get to be bad habit commander in the up and coming one-day global arrangement in Ireland and England.
Australia's next Test arrangement is against Bangladesh in September and October.
Swamp said Warner, who has pulled in debate more than a few episodes including punching Britain's Joe Root in 2013, had "developed and formed into a critical senior figure in the Australian group".
"He has made some amazing progress," Swamp said.
"He had significant experience captaining the Sunrisers in the IPL (Indian Chief Association) prior this year and we are certain he will give solid backing to Steve as his agent.
"We trust that he will react well to the included obligation of authority."
Clarke, 34, declared he was resigning after Britain finished a devastating innings and 78-run triumph at Trent Span in the fourth Test to take a superb 3-1 lead in the five-match Fiery debris arrangement. He will play his last Test at The Oval in the not so distant future.
Cricket Australia administrator Wally Edwards supported the side's new initiative.
"We have all seen Steve Smith's reasonable authority potential and trust he can perform a phenomenal employment for Australian cricket over numerous years," said Edwards.
"We upheld the suggestion to delegate David Warner as bad habit skipper, taking note of his part as a main batsmen, his improvement and development as a pioneer inside of the group."
Smith, who scored a century in each Test he captained in Australia the previous summer, had guaranteed to be less guarded if gave the employment of captaining the country's eleven.
"On the off chance that I am named the skipper I might want to lead from the front with my exhibitions, without a doubt," he said for this present week. (AFP)