O'Brien will replace Valerie Amos who served as under-secretary for humanitarian affairs and emergency relief for the past four years, earning high praise for her commitment in one of the UN's most demanding posts.
"Mr O'Brien is expected to bring innovative and strategic ideas as a strong humanitarian advocate with more than 20 years of experience in international development and health care," UN spokesman Stephane Dujarric said.
The British national will be tasked with leading a struggling relief effort in Syria along with major aid operations in South Sudan, Iraq, the Central African Republic and a dozen other trouble spots.
The announcement was one of the most closely-watched appointments at the United Nations in recent years.
Also Read
Humanitarian aid groups expressed concern in a letter to Ban in December that a political appointee would be chosen over a qualified official with strong humanitarian expert.
Non-governmental organizations had raised alarm following reports that Cameron was pushing for the appointment of Andrew Lansley, who is known for a failed health care reform in Britain.
O'Brien will be the third British national since 2007 to hold the top post at the United Nations and was one of three candidates put forward by Cameron's government for the job.
British Ambassador Mark Lyall Grant said O'Brien is "extremely well qualified for the role", citing his work as Sahel envoy and in the international development department.