Malthouse is set to overtake Collingwood legend Jock McHale's record of 714 games as a senior coach.
The three-time premiership coach is on 664 games after his stints at Footscray (now the Western Bulldogs), West Coast and Collingwood over the last four decades.
"It does give me a great sense of honour to be given the opportunity to coach this famous club," said Malthouse, who turns 59 on Monday.
"I just see it as an extension of life, to be able to stay in the game of football and more importantly ... to be offered the coaching job and be part of this football club."
Malthouse and Blues president Stephen Kernahan fronted the media on Tuesday morning to confirm a deal that was a given the moment the club sacked Brett Ratten as coach last month.
Speculation about Malthouse joining Carlton started months before they made the ruthless decision to axe Ratten, one of the club's most loved figures.
"It's a good day and a tough day," said Kernahan, a long-time friend and premiership teammate of Ratten's.
Adding to the enormity of this appointment, Malthouse joins Carlton after more than a decade in charge of their hated rivals Collingwood.
But as Ross Lyon has shown this season at Fremantle, any misgivings or unease among Carlton fans will quickly disappear if Malthouse returns their side to the top eight.
Malthouse has spent the 2012 season in the media, having resigned from the Magpies immediately after last year's grand final loss.
He handed over to Nathan Buckley as part of a succession plan that was brokered in 2009.
Malthouse's new deal will start on November 1 and he will take over a side that dropped out of the top eight this season after three previous years in the finals.
Malthouse was at his prickly and combative best on Tuesday morning, verbally sparring with several journalists.
He insisted the first contact he had with Carlton was a meeting with Blues officials eight days ago.
One immediate issue is the fate of several assistant coaches, with the club expected to cut ties with Mark Riley, Paul Williams and Alan Richardson.
Another early matter for Carlton's Malthouse reign will be whether they recruit out-of-contract Collingwood key forward Travis Cloke.
Asked if he would go after Cloke, Malthouse replied "absolutely".
Cloke played under Malthouse at Collingwood for several seasons.
But Kernahan still thinks Cloke will stay with the Magpies.