Johnson, 31, was the outstanding candidate from 120 applicants impressing chairman Simon Corney and the board of directors.
He inherits a Latics side who currently lie 21st in the League One table following Paul Dickov's departure in February and will be in the dugout for Tuesday night's crucial game against fellow strugglers Hartlepool.
Johnson, the son of Yeovil boss Gary Johnson, becomes the youngest manager in the Football League with the Boundary Park job his first managerial role after a successful playing career with Yeovil, Bristol City and Kilmarnock.
"I do feel like I'm ready. I'm ecstatic to be here and really looking forward to it," he told Sky Sports.
"I've been given an awful amount of encouragement from the board and that gives me strength. I'm proud that I am part of such a great club."
He takes the reins from caretaker manager Tony Philliskirk who leaves the League One side two points from safety with two games in hand on the teams above them.
"I've no doubt we can stay up," he said. "My dad's been great all through my career. I've second guessed everything he's ever done. That experience is invaluable to be able to draw back on.
"I've done the due diligence. I've been to the last six or seven games. I've already got a good idea of what I feel is needed to improve.
"We've got to do everything right. I was saying to the players today, they have to live like they are the ultimate professional. We can't take risks, we've got to make sure that everything we do is towards keeping Oldham in League One."
In his playing days, the Suffolk-born midfielder achieved a double promotion in a five-year spell at Yeovil under the management of his father before moving to Hearts in 2006 where he picked up a Scottish Cup medal.
Johnson then rejoined his dad at Bristol City where he celebrated promotion to League One before reaching the 2008 play-off final, losing out to Hull at Wembley.
He ended his playing career at Kilmarnock where he won the Scottish League Cup, assisting Dieter van Tornhout's winner against Celtic, and now faces an immediate challenge to escape relegation as he follows his father's footsteps into management.