Milo Djukanovic will become Montenegro's prime minister for a fifth time, replacing Zeljko Sturanovic who resigned last week in ill health, his party said.
The coalition led by the Democratic Party of Socialists (DPS), which he heads, nominated Djukanovic and since it has a majority in parliament, his appointment is assured.
Djukanovic said his priorities would be to improve living standards and pursue European Union and NATO membership.
"The government must improve economic structures so we can fully eliminate unemployment in the near future," he said told reporters. He was expected to reshuffle Sturanovic's cabinet.
Djukanovic's retirement from active politics in October 2006 was a surprise in a year of triumphs. When a majority of Montenegro's 650,000 people voted in a referendum that May to end their union with Serbia, their choice was seen as his personal achievement as architect of the independence drive.
His coalition won a majority in an election three months later. He turned down the post of prime minister in favour of Sturanovic, his solid but rather colourless justice minister, and only retained his post as DPS leader.
At the time, he said he was "tired from the responsibility" of 15 years in politics, and intended to catch his breath "with a more relaxed lifestyle", branching out into business.
Analyst Srdjan Vukadinovic said Djukanovic initially meant be the power behind the throne from his post as party head, but found it was not the same as when he held the reins himself.
"I believe this is Djukanovic's main motive for returning," Vukadinovic said.
Nebojsa Medojevic, one of the main opposition leaders, said his return would harm the country because of his huge personal influence on Montenegrin institutions.
Since leaving its lopsided union with Serbia, Montenegro has posted strong growth, mostly due to a boom in tourism and steady foreign direct investment, especially in real estate.
It signed the Stabilisation and Association Agreement with the European Union last year and hopes to join the bloc by 2015.