Le Tissier said: "As everyone knows Southampton FC has been a huge part of my life and I would find it incredibly difficult to simply walk away from the club after my days as a player were over.
"It is something I am looking forward to immensely. I see it as a new personal challenge and a chance to continue my relationship with Southampton and their fans who have made my career such a thrilling and rewarding experience. In some ways it is a chance to give something back to those fans."
Rupert Lowe added: "Matthew Le Tissier is a name that we are happy to say is synonymous with Southampton Football Club due in equal measure to his incredible loyalty and also his outstanding ability as one of the most gifted players of his generation.
"Once Matthew's playing days were over, the club were keen for him to remain involved in some manner. In this agreed role he will be an integral part of the club's future.
"We are delighted that Matthew is to remain with the club even though he has hung his boots up. We very much look forward to working with him again."