It will be the first time for the comedian, who has hosted "Jimmy Kimmel Live!" on ABC since it launched in 2003 and garnered praise for his work as host of this year's Emmys television awards.
"Yes, I am hosting the Oscars. This is not a prank. And if it is, my revenge on @TheAcademy will be terrible & sweet," the 49-year-old New Yorker joked on Twitter.
His selection was later confirmed by Michael De Luca and Jennifer Todd, the multiple Oscar- and Emmy-nominated duo producing the 89th Oscars ceremony, which airs live on ABC television on February 26.
"Jimmy's ability to connect with people is what makes him a singular choice for this job," they said in a joint statement.
"His frank observations, relatable persona, wry humor and love of all kinds of film make him a natural fit for the Oscars stage."
Academy president Cheryl Boone Isaacs said she was thrilled to have a host who "knows who he is, he knows the audience" while CEO Dawn Hudson described Kimmel as "razor sharp, funny and unpredictable."
ABC, which pays the Academy a reported $75 million a year to broadcast the Oscars, struck a new deal in August giving executives more creative input.
"Jimmy is the perfect choice for us. He is deeply rooted in the Hollywood community and gifted at connecting with an audience as the consummate emcee," said ABC Entertainment president Channing Dungey.
Kimmel's appointment comes unusually late this time around, as the host is usually booked months in advance of the Oscars.
It will end speculation over several other possibilities for presenter, including fellow comedians Ellen DeGeneres and Tina Fey.
Chris Rock hosted the 2016 ceremony, which suffered an eight-year low in ratings, averaging 34.5 million viewers.
The African American comic actor's second stint presenting was overshadowed by a social media backlash against the lack of racial diversity among the nominees, under the hashtag #OscarsSoWhite.
Ironically, a group of 25 Academy members of Asian descent, including Oscar-winning film director Ang Lee and "Star Trek" actor George Takei, subsequently complained about racist jokes at the ceremony.
It featured a section in which Rock introduced children of Asian descent as Academy accountants and an ad-libbed insinuation by actor Sacha Baron Cohen that Asian men were not well-endowed.
