The 41-year-old coach spent six years at Stamford Bridge, signing from Lazio in 1996 and staying until his forced retirement from injury as a player in 2002.
Following a run of poor results in February for West Brom, Di Matteo was sacked, the Italian has been out the game since and will now look forward to working with Villa-Boas.
Villas-Boas said: "If you see the technical staff in front of me, and my appointment of Roberto, these are people who like the quality of the game and have a philosophy.
"It's not just a case of winning it's a case of flair.
"Everyone likes attacking football and the Premier League has a certain amount of goals in every game and it should be an entertaining game for the fans and that is what we will look to do."
