Ross links up with the backroom staff at Rodney Parade with immediate effect after leaving his previous role at Worcester Warriors.
The 42-year-old joins Mefin Davies, Luke Narraway and Simon Cross in a new-look coaching team at Dragons.
Ross will work alongside Barry Maddocks, who takes on the role of skills coach while Alan Kingsley becomes kicking consultant for the region.
Dean Ryan, director of Dragons Rugby, said: “We’re pleased to confirm Gordon’s appointment as we continue to invest in our coaching set-up and environment.
“I worked closely with Gordon during our time together at Worcester and know he is a talented and ambitious coach who is excited about the opportunity to work in Wales.
“Gordon is ready to take on this important senior role with us and make a real impact on our backs as we look to move forward and develop as a squad.”
Edinburgh-born Ross won 25 caps for Scotland during his playing career, scoring 55 points, and appeared at the Rugby World Cup 2003.
At club level, he represented Edinburgh, Leeds Tykes, Castres and Saracens before finishing his playing days at London Welsh.
Ross scored 696 points during 103 appearances in the English Premiership and was voted man-of-the-match as Leeds beat Bath in the 2005 Powergen Cup final.
He moved to Sixways in the summer of 2015, after spending 2014/15 as assistant coach at London Welsh.
Among the players Ross will now be working with are new Dragons recruits and Wales backs Nick Tompkins and Jonah Holmes.
Rhodri Williams, Josh Lewis, Jordan Williams, Tavis Knoyle, Owen Jenkins, Rio Dyer and Will Talbot-Davies have also all agreed new terms with the Dragons.