Brown played 254 matches with the Magpies between 1987 and 2000, including the 1990 premiership, winning three best and fairest awards.
He was assistant coach at Collingwood for six seasons from 2002 before being appointed coach of the Magpies' VFL team.
Carlton's general manager of football Steven Icke said Brown's appointment as an assistant coach would provide the coaching staff with "tremendous experience and knowledge.
"He was a part of the 2010 premiership club and has been at Collingwood all his AFL career so the fact he has made the decision to join Carlton is an endorsement of where the Carlton Football Club is heading," Icke said.
Brown said he was looking forward to an exciting new phase of his career.
"It is obviously a big decision for me to leave Collingwood, the club I have been with for over 25 years, but I believe Carlton has an exciting future and I am keen to be back working full-time with an AFL team as part of the coaching team at the Blues," he said.
In a statement on its website, Collingwood said Brown had ambitions to become a senior AFL coach and was departing to experience a new environment and a different football program.
"The club has been aware of Gavin’s coaching ambitions and while he’s been doing a fantastic job coaching and developing players through his role as coach of our VFL team over the past three years, the club also supports Gavin’s move as something that he believes he needs to do at this stage of his career."
Brown told the Collingwood website he was "eternally grateful to the Collingwood Football Club for the opportunity it has given me in my life as both a player at the club and then in a coaching capacity.
“Collingwood has been such a huge part of my life and has given me such amazing opportunities. It has really shaped and moulded the person I am.
“The decision to leave has been made a lot easier given the fact we have won the premiership this year. I feel a sense of accomplishment in the role I played in this achievement.
“Leaving has been the biggest decision I’ve had to make in my life, and I’ve done so with mixed emotions."
Brown's appointment is the second major addition to the Blues' coaching line-up this week after the announcement that former Essendon assistant coach Alan Richardson would be joining the panel.
