President Abedrabbo Mansour Hadi's decision to appoint Saudi-based General Ali Mohsen al-Ahmar, a northerner known for his close ties to Sunni Islamists, was published on the government's official sabanew.net website late Monday.
Hadi himself is supreme commander of the armed forces.
Ahmar's troops played a prominent role in the 2011 uprising that ousted strongman Ali Abdullah Saleh, whose loyalists are now allied with Iran-backed Shiite rebels who control the capital.
In 2013, Hadi named the influential general his military and security affairs adviser after dramatically restructuring the military to curb the influence of those linked to Saleh.
Military sources explained Hadi's decision as an attempt to gain the confidence of tribal dignitaries and senior army commanders in the Sanaa region, where Ahmar wields much influence.
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His Al-Ahmar clan has historically led the influential Hashid confederation in northern Yemen.
Hadi's move comes as loyalist forces, backed by a Saudi-led coalition, try to advance on Sanaa which the rebels captured in 2014.
Earlier this month, pro-government forces took the town of Nihm, within 40 kilometres (25 miles) of Sanaa, after overrunning the headquarters of a renegade pro-rebel army brigade, loyalist military sources said.
Coalition forces have meanwhile intensified their air strikes against rebel positions around Sanaa over the past week, military sources added.
Since the coalition intervened in support of Hadi last March, his loyalists have ousted the rebels from five southern provinces.
In the north the insurgents have been largely confined to Marib, east of Sanaa, and Jawf on the border with Saudi Arabia.
Progress has been slow, partly because of mountainous terrain and partly because of determined backing for the rebels from army units still loyal to Saleh.