Betting patterns throughout Thursday suggested that the former Scotland boss was the man the club hierarchy wanted to replace Sean O'Driscoll after his Boxing Day sacking and McLeish will take charge with immediate effect.
"I believe he's the man who can help us fulfil our ambition of making it to the Premier League," said Forest chairman Fawaz Al Hasawi.
McLeish said: "The fact a club of Forest's magnitude has offered me a job excites me greatly."
Managers' reputations are often only as good as their last job and McLeish's ill-fated move time with Aston Villa means his appointment will not be without its detractors.
Some of the headlines announcing the news use the words 'unpopular' and 'gamble' but the Reds hierarchy will look beyond that and point to a man with experience in the hothouse of Old Firm rivalry and of international football as well as someone who has taken a side to promotion from the Championship in the recent past.