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He will replace Martin Snedden, who leaves his post next month to become CEO of the organising committee for the 2011 Rugby World Cup.
Vaughan, a qualified doctor, played six Tests and 18 one-day internationals during his career.
Born in Hereford, England, the 39-year-old also had a spell in county cricket with Gloucestershire.
He currently heads a medical technology company but has also served as a member of the New Zealand Cricket board since retiring 10 years ago.
"As an NZC Board member, a former BLACKCAP and a successful chief executive officer, Justin has all the attributes required to take over from Martin Snedden and to lead New Zealand Cricket.
"Justin has impressed as a member of the NZC Board, and his time on the Board will see him quickly settle into the chief executive role," said chairman Sir John Anderson.
Vaughan will take up his role in June and has promised to work to improve standards from grass roots level through to the national men's and women's teams.
"I have had a long association with cricket and hope to build on the hard work which has taken cricket in New Zealand from a largely amateur structure in the early 1990s to the professional sport that it is today," he commented.
"I hope to build on the hard work which has taken cricket in New Zealand from a largely amateur structure in the 1990s to the professional sport it is today."
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