Taylor won the captaincy ahead of wicketkeeper-batsman Brendon McCullum after a lengthy deliberation.
He was recommended for the position by New Zealand's Director of Cricket John Buchanan, national coach John Wright and acting national selection manager Mark Greatbatch, and unanimously approved by the board of New Zealand Cricket.
Chief executive Justin Vaughan said Taylor had been "an impressive deputy to Dan Vettori since taking over the vice-captaincy and (had been) shown to be a very capable leader when he has had the opportunity."
"The process to select the captain has been robust," he said. "We wanted to make sure the right people were involved and that we appointed the right man for the job — I'm sure we have done that."
Taylor, 27, has played 30 tests for New Zealand, averaging 40, and 107 one-day international averaging 36.8.
"I've learnt a great deal about leadership having played under Dan Vettori and feel ready to take on what is one of the highest honours in New Zealand sport," he said.
"I'm looking forward to the challenge and appreciate the level of responsibility that comes with captaining your country. I believe we have the quality in the dressing room to be a force in world cricket and I'm keen to play the best cricket possible to help take the team forward."
Vettori was the youngest player to represent New Zealand when he joined the team in 1998, aged 18. He succeeded Stephen Fleming as captain in 2007.
All-rounder Vettori announced prior to the World Cup that he was resigning the test captaincy and was retiring from one-day and Twenty20 internationals.
