Fortuna Sittard confirmed his appointment on their website, saying he had signed an 18-month contract.
Oliseh, 42, has an option to extend it for another season.
He will take charge of training at Fortuna Sittard for the first time on 2 January.
The club's Turkish owner, Isitan Gün, said he was 'very happy' to announce Oliseh's arrival.
"With Sunday Oliseh we signed a young and ambitious coach with vision, one players look up to," Gün said.
"We were looking for someone who plays attractive football combining it with the will to win. We think Sunday is the right one for this job," Gun added.
Oliseh, who also played for Juventus and Borussia Dortmund during his club career, earned 63 caps for Nigeria.
He helped his country win the 1994 Africa Cup of Nations and Olympic gold in 1996.
Before taking on the role of head coach with Nigeria, Oliseh had previously coached Belgian lower tier side Verviétois.