The Premier League side will pay a compensation of between £3.25 million to £4 million to Rangers for Gerrard and his assistant Gary McAllister.
Gerrard, 41, has been in charge of Rangers since June 2018.
The former Liverpool captain led the club to the Scottish Premiership title last season, ending Celtic’s nine-year reign as champions.
He replaces Dean Smith who was sacked on Sunday, following a run of five successive Premier League defeats.
The club sit 16th in the Premier League table, two points above the relegation zone after 11 games of their campaign.
Gerrard’s first match in charge will be the Premier League fixture against Brighton on November 20.(Dailypost)