The firm on Thursday appointed former Givenchy designer Riccardo Tisci as its new chief creative officer, effective from March 12.
It comes as new Burberry chief executive Marco Gobbetti, who took over from Mr Bailey last year, oversees a strategic overhaul at the group.
Mr Tisci, who spent more than a decade at Givenchy as creative director, will direct all Burberry collections and present his first for the brand in September.
Mr Gobbetti said: “Riccardo is one of the most talented designers of our time. His designs have an elegance that is contemporary and his skill in blending streetwear with high fashion is highly relevant to today’s luxury consumer.
“Riccardo’s creative vision will reinforce the ambitions we have for Burberry and position the brand firmly in luxury.”
In October, Burberry confirmed that Mr Bailey will step down from the board, ending his 17-year stint at the high-end fashion house.
Mr Bailey led the firm as chief executive from 2014, but was succeeded by Mr Gobbetti in July 2017.
Mr Gobbetti previously worked with the new creative director when he headed up Givenchy from 2004 to 2008.
Mr Tisci said: “I am honoured and delighted to be joining Burberry as its new chief creative officer and reuniting with Marco Gobbetti.
“I have an enormous respect for Burberry’s British heritage and global appeal and I am excited about the potential of this exceptional brand.”
Last month, the luxury retailer announced it had launched a new global partnership with Farfetch, the leading technology platform for the fashion industry, to extend the brand’s reach to over 150 countries.
Burberry, which has manufacturing sites in Castleford and Keighley and a customer services office in Leeds, said the deal will strengthen its e-commerce presence around the world.
For the first time, technology developed by Burberry has been integrated to the Farfetch API – the platform’s operating system - allowing the brand’s entire global inventory to be available through an e-commerce platform.