Howard Wilkinson, who left the post to take over as Sunderland manager in 2002, said it was "high time" that the FA made such a move.
The successful candidate is likely to be an experienced manager and will head up operations at the FA's new national football centre at St George's Park near Burton-on-Trent.
Wilkinson told the Press Association: "Any federation needs someone who is responsible for the strategic direction in terms of technical matters and the FA is no different.
"It is high time someone was appointed, absolutely yes. I can't think of a country in Europe that does not have one.
"From my point of view it is a welcome announcement and if we are going to make the most of the opportunity that St George's Park offers to us, then in the long term you need someone to think into the future and to plan for the future."
Wilkinson has for years called for such an appointment. Les Reed was appointed to the role in an acting capacity after Wilkinson, but lost his job in an FA shake-up in 2004.
The new technical director will work alongside Sir Trevor Brooking, the FA's director of football development, and lead the drive to make St George's Park a centre of excellence for coaches.
Alex Horne, the FA's general secretary, said: "The role of technical director will be crucial as we continue to strive towards improving the technical ability and knowledge of our players and coaches, both now and in the future."
The new technical director will have to possess a UEFA Pro Licence or the equivalent and is part of the FA's drive to raise the standards of football at elite and grassroots level.
St George's Park will also have the latest sports science and medical facilities and the new man will work at maximising the influence of cutting-edge developments in the game.
The successful candidate will also work with Premier League and Football League representatives on the new Elite Player Performance Plan (EPPP). The EPPP is aimed at boosting the chance of domestic talent breaking through into first-term football and will rank club academies to determine their funding levels.
There has been opposition to the EPPP from some Football League clubs who believe they will get less compensation for talented young players who come through their ranks.
Meanwhile, the FA welcomed the Government's announcement on Tuesday of increased planning protection for playing fields and sports facilities.
The revised National Planning Policy Framework (NPPF) includes the commitment that playing fields and facilities should not be built on unless they are surplus to requirements, can be replaced 'like for like' or used for an alternative sporting provision.
FA general secretary Alex Horne said: "The FA welcomes the changes made to the new National Planning Policy Framework and is pleased that the Government has positively responded to our concerns.
"The protection of playing fields and sports facilities is fundamental to increasing participation and enjoyment of football at every level and in every community.
"Ensuring 'like for like' replacement for lost fields and facilities is a great boost to this cause."