Hodgson has turned to Neville to be his first full-time appointment following the part-time arrivals of Fulham coach Ray Lewington and Birmingham City goalkeeping coach Dave Watson.
Roy Hodgson: "Gary has achieved so much in the game as a player with Manchester United and England.
"He has obtained UEFA coaching qualifications and will be tremendously respected by the players because of his vast experience as a player.
"At my first meeting with The FA, I explained that Gary was someone I wanted as part of my staff.
"I think it is very important we have a younger coach who knows the dressing room and is very experienced at international level.
"That he has represented England as a player at five major finals tournaments will make him an invaluable member of staff."
Hodgson is due to announce his squad for the tournament in Poland and Ukraine on Monday.
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