The Crociati dropped out of Serie A 10 days ago following defeat at home to Inter.
Parma sacked Hector Cuper before their final match against the Nerazzurri and gave youth-team coach Andrea Manzo a caretaker role.Manzo has since been asked to step down and make way for Cagni, who left Empoli last week after their relegation.
The 58-year-old has signed a two-year contract and will be heartened by reports that star striker Cristiano Lucarelli is happy to stay at the club.
Cagni began his career as a tactician at Brescia in 1988, coaching the youth team, before moving to Cenese.
He then became coach of Piacenza, where he made his name after leading the Emilian side from Serie C1 to Serie A.
Parma are Cagni's 10th club and their fans will be hoping the Lombard is able to guide them straight back to Italy's top tier.
Source: C4 Football Italia
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