Iraqi President Barham Salih appointed on Saturday former Communication Minister Mohammed Tawfiq Allawi as the country's new prime minister, state TV reported.
The newly-appointed prime minister will have to form a new government in a month and hold the office until early elections are held.
The appointment has ended a two-month-long political deadlock as parties have failed to name a candidate after the previous prime minister was ousted amid huge waves of protests.
Iraq has been gripped by mass protests since October, when activists took to the streets to demand a change in the country's "corrupt" political system. More than 450 people have been killed in the protests since then.
In late-December, Iraqi President Barham Salih refused to designate the city of Basra's governor as the new prime minister. He said that he would rather step down than appoint someone who has been rejected by the protesters.