Manning, who starred as a player at Kansas in the 1980s and spent 15 seasons in the NBA, brings name recognition to the Demon Deacons.
The 47-year-old was hired Friday after interviewing for the job earlier this week.
"I am excited about the opportunity to be a part of the history and tradition of Wake Forest," Manning said in a statement. "I am extremely humbled by this honor and look forward to being the head coach and competing for championships both on and off the court."
Manning attended high school in Greensboro, N.C., which is about a half-hour drive from Wake Forest in Winston-Salem. He went on to become an All-American at Kansas and led the Jayhawks to the 1988 NCAA title.
Manning went 38-29 with two postseason berths in his brief tenure at Tulsa.
Athletic director Ron Wellman said the hiring process was slowed by his place as NCAA Tournament selection committee chair.
"We are very pleased to welcome Danny Manning to Wake Forest," he said in a statement. "There have been very few players who have had as much success on the court as Danny. He has played for and worked under a number of legendary coaches and he has been successful in his coaching career. We fully expect that Danny's coaching career will reflect the excellence of his playing career."
The Wake Forest job opened up two weeks ago when Jeff Bzdelik resigned after four lackluster seasons. The Demon Deacons went 6-12 in the ACC this season.
After a decorated collegiate career, Manning was the No. 1 pick in the NBA draft in 1988 by the Los Angeles Clippers. He was selected to two All-Star teams but injuries prevented him from reaching his full potential.
Manning joined the Kansas coaching staff in 2003 and was promoted to assistant coach in 2006. He earned his first head coaching job at Tulsa two years ago. The Golden Hurricane advanced to the CBI in 2013 and won the Conference USA tournament title this year. Tulsa received a No. 13 seed in the NCAA Tournament (its first appearance since 2003) but lost the opener against UCLA.