Brokerage regulator NASD on Thursday said Vice Chairwoman Mary Schapiro would succeed outgoing Chairman and Chief Executive Robert Glauber at the end of this year.
Glauber, who became NASD's chairman in September 2001 after becoming CEO in November 2000, will remain in his positions until December.
In recent months, speculation has centered on Schapiro, who joined the NASD in 1996, as the most likely candidate to succeed Glauber.
Schapiro said in an interview that she was taking over an organization that was "very solid" and did not need any rebuilding.
"The challenges over the next few years will revolve around keeping up with a lot of the financial innovation that we're seeing in terms of the new products being developed and offered to the public," she added.
The NASD, the brokerage industry's self-regulatory body, was formerly known as the National Assn. of Securities Dealers.
Before her role at the NASD, Schapiro was chairwoman of the Commodity Futures Trading Commission and served on the Securities and Exchange Commission for six years.
Henry Hu, professor at the University of Texas School of Law, said Schapiro had a "tremendous variety of experience."