The Reds legend, who spent 17 years in the first-team at Anfield before an emotional departure in May 2015, will start working within a "wide-ranging role" full-time in February with Liverpool's youngsters from the Under-16s up to the Under-23s.
He is expected to initially start with the club's older age groups, with this the 36-year-old's first return to work since he announced his retirement from his playing career in November.
The former midfielder and club captain is currently completing his coaching badges, namely his UEFA A Licence, and will assist in the development of the club's young prospects.
Gerrard himself graduated through Liverpool's Academy and his incredible experience, going down as perhaps the club's best ever player having won 10 trophies on Merseyside, no doubt bodes him well at the club's Kirkby training base.
It is expected that the former England international, who scored 21 goals in 114 caps, will work under Academy director Alex Inglethorpe - who signed a fresh multi-year contract in reward for his work in November.
Legendary former skipper keen to "really help" in new role
Upon the official announcement of his new coaching capacity at Liverpool, Gerrard told the club's official website that taking the role "feels like completing the circle" as he returns "to the place where professionally it all began."
Yet he vowed that "this isn't a decision based on emotion" and rather one based on what he "can offer and contribute" to the club.
He added: "I don't think I need to explain to people what this football club means to me, but when I knew coming back was a serious option - I wanted to make sure it was a substantive role and a role in which I could really help the organisation."
Gerrard, who hung up his boots towards the end of last year having left to see out his days at LA Galaxy following 710 appearances and 186 goals for Liverpool, said that "it just felt right" to accept the offer after "seeing the work they are currently doing and want to do in the future at Kirkby."
The former No.8 declared that it is "the right option at the right time for all parties involved" and offers him "a great opportunity to learn and develop as a coach."
Gerrard also says that the role allows him to offer his "knowledge, ideas and experience to the young players" at the club "at an important period of their development."
Academy director Inglethorpe says Gerrard's return has "immense" benefits
The Huyton-born Englishman, who joined the club at the age of eight after his talents were spotted while in action for a local youth team, is the longest-serving captain in Liverpool's illustrious history.
Gerrard remains Liverpool's third-highest appearance maker, and only four players have scored more goals than him, having notched in the finals of the UEFA Champions League, UEFA Cup, FA Cup and League Cup - the only player ever to do so.
Liverpool's Academy director Inglethorpe is hopeful that Gerrard can help be beneficial for all involved, and said that it is a "substantial" one.
"If I was to pick one individual who embodies the characteristics and values we are looking to instil into our organisation at Kirkby, it would be Steven Gerrard," he told Liverpoolfc.com.
Inglethorpe added that it is "simply great news for everyone connected to the club" that Gerrard is "so enthusiastic about being part of what we are looking to do."
He said that it wouldn't be a surprise to know that Gerrard "had a host of great options" for the next step of his career, and the first step of his career into management and coaching.
But he added that it has been "evident from the first meeting" that "his heart and head" belongs at Liverpool, insisting he has "shown great humility in making it clear from the outset" that Gerrard "wants a role where he can contribute to Liverpool."
Inglethorpe believes it is "typical" of Gerrard because "his priority has been defining the role so it helps the club" ahead of his own aspirations, explaining that doing so shows that he has "expressed a desire to learn from us and manage a young team."
He vowed: "The benefits to us will be immense. This is a substantial role and one which makes the Academy, and the club in general, stronger and better."