The former Dundee United, Rangers, Newcastle and Everton striker has signed a three-year contract.
The job is Ferguson’s second in management after a brief spell at Forest Green last season. Rovers only won one of the 18 games the former Scotland forward took charge of and were relegated from Sky Bet League One.
The ex-Everton coach succeeds Billy Dodds, who lost his job months after leading Caley Thistle to the Scottish Cup final. Inverness are bottom of the cinch Championship with one point from five games.
Inverness said the appointment came after an “extensive recruitment process which involved some truly excellent candidates”.
A club statement added: “Duncan has worked alongside some of the most respected and outstanding football coaches in the world in recent seasons and we are proud to have him join ICTFC as our new manager.
“His professionalism, commitment and dynamic leadership skills shone through in our discussions, making him the standout candidate.
“Everyone at the club is looking forward to supporting Duncan as the hard work starts now and we hope every Caley Jag will now get right behind him and the team in what we are sure will be a thrilling journey.”
