Chaney will receive a three-year contract worth approximately $1.6 million per year, making him one of the highest-paid offensive coordinators in college football.
This will be Chaney's second stint at Tennessee. He was the Vols' offensive coordinator and quarterbacks coach for four seasons from 2009 to 2012, working under both Lane Kiffin and Derek Dooley.
Chaney replaces Tyson Helton, who left Tennessee after one season to become the head coach at Western Kentucky.
Volunteers coach Jeremy Pruitt also spoke with then-Houston offensive coordinator Kendal Briles, UCF offensive coordinator Jeff Lebby, former Maryland offensive coordinator Matt Canada, new Liberty coach Hugh Freeze, new Kansas offensive coordinator Chip Lindsey and Steve Sarkisian, who was recently let go as the Atlanta Falcons' offensive coordinator, about the job.
Chaney just finished his third season as Georgia's offensive coordinator. He will be Tennessee's fourth different offensive coordinator in as many years.
Chaney directed a Georgia offense that led the SEC in rushing (238.8 YPG) and ranked No. 2 in scoring (37.9 PPG), No. 5 in total offense (464.9 YPG) and No. 8 in passing (226.1 YPG) in 2018.
"He has been an integral part of our team and program over these past three years and we are grateful for his contributions to the Bulldogs during that time," Georgia coach Kirby Smart said in a statement. "I'm sure this represents a new challenge that will be exciting for Jim and his family, and we wish him all the best."
ESPN's Mark Schlabach and The Associated Press contributed to this report.