Berrada's start date will be confirmed in due course, while Patrick Stewart will continue as interim CEO.
"The Club is determined to put football and performance on the pitch back at the heart of everything we do. Omar’s appointment represents the first step on this journey," the club said.
"Our stated ambition is to turn Manchester United back into a title-winning club. We are delighted that Omar is joining us to help us achieve that goal, so that, once again, United fans can see, in the words of Sir Matt Busby, the red flag flying high at the pinnacle of English, European and world football."
Berrada, regarded as one of the most experienced executives in European football, currently holds the position of Director of Football Operations at City Football Group, where he oversees 11 clubs across five continents. He previously held senior positions at Barcelona.
United, who currently sits seventh in the Premier League table, bolstered its squad in the summer transfer window, with new signings including Rasmus Hojlund from Atalanta, Mason Mount from Chelsea and Andre Onana from Inter Milan.
In addition, British billionaire Jim Ratcliffe acquired a minority stake last year, signaling a new beginning in the club's turnaround plan.