McNamara, 45, has succeeded Laurent Frayssinous at the French club after being released from his contract as assistant coach with National Rugby League side New Zealand Warriors.
McNamara coached England between 2010 and 2015, and led them to the semi-finals of the 2013 World Cup.
Jerome Guisset and Michael Monaghan will stay as assistant coaches.
Former Bradford coach McNamara will arrive in Perpignan on Tuesday, in time to take charge of Saturday's Super League fixture with Warrington.
Guisset and Monaghan have been in caretaker charge since Frayssinous' departure in May, with the side ninth in the table following a 56-12 defeat by Huddersfield in their most recent match.
"My wish was to find an English coach, recognised and respected in his country and in this competition," Catalans chairman Bernard Guasch told the club website.
"The choice of Steve, the former England coach, was the best in my opinion.
"He expressed his desire to come to France to lead the Dragons and we were lucky that he was available immediately."
Former England coach Steve McNamara has joined Catalans Dragons as head coach on a two-and-a-half-year contract.