The London Organising Committee of the Olympic Games and Paralympic Games (LOCOG) today announced the appointment, which completes the senior creative team for next year's Olympic ceremonies.
Rick Smith and Karl Hyde will work alongside artistic director Danny Boyle and be responsible for all the music in the three-hour ceremony on July 27.
Boyle said: "Appointing Underworld to direct the music in the Olympic Opening Ceremony is the final piece of the jigsaw for the team of leading British creatives who will deliver the ceremonies."
Underworld have collaborated with Boyle several times in the past.
The duo's track 'Born Slippy .NUXX' featured prominently in 1996's Trainspotting and the pair also worked on the soundtracks for Boyle's A Life Less Ordinary, Sunshine and this year's National Theatre stage production of Frankenstein.
Boyle added: "What's interesting about working with them is how much broader their taste is than you might imagine.
"With Frankenstein we really saw how far we could take a broader approach than we'd used together on the films."
Underworld admitted earlier this year that they can never turn down a request from Boyle.
Frontman Hyde said: "Every time Danny asks us to get involved in a project, we say yes 'cos we know it's going to be a journey that will take us to strange new places."
Other appointments to the London ceremonies have included Take That's creative director Kim Gavin as artistic director for the Olympic and Paralympic closing ceremonies, joined by costume designer Es Devlin and Bond film composer David Arnold.
The opening and closing ceremony teams also include Stephen Daldry, Mark Fisher, Hamish Hamilton, and Catherine Ugwu, Jenny Sealey MBE and Bradley Hemmings.
> Elbow to soundtrack BBC Olympics 2012 coverage
Watch the Underworld 'Born Slippy .NUXX' music video below: