Nooyi, currently chief financial officer for PepsiCo, will replace the retiring Steve Reinemund to become the firm's first female chief executive on 1 October.
She will have the task of continuing the group's strong performances of late, which culminated last year with Pepsi overtaking Coca-Cola in market value for the first time in 112 years of rivalry.
Nooyi's appointment is likely to be seen by some as a heavily political choice, especially given PepsiCo's current row in India over whether its drinks there contain pesticide residues. Several Indian states have banned both Pepsi and Coca-Cola drinks from public buildings.
PepsiCo, however, said Nooyi had been instrumental in driving its global strategy for more than a decade, and credited her with a pivotal role in adding current high-flying businesses - Tropicana, Quaker and Gatorade - to the group's portfolio.
Reinemund, too, has been widely praised for reinvigorating Pepsi in recent years by diversifying into new products and spotting consumer health trends sooner than some competitors.
PepsiCo's net profits rose 70 per cent between 2001, when Reinemund began as chief executive, and 2005.
Nooyi has worked closely with Reinemund since 2001, and her appointment perhaps shows that PepsiCo has been looking for someone from the same mould.
The fact that she is Indian-born does, however, add an extra international dynamic to PepsiCo's business, at a time when food and drink firms are increasingly looking to emerging markets, such as India, China and Russia, for growth.
PepsiCo's international division increased sales by 13 per cent in 2005, ahead of the 10 per cent rise achieved by the company as a whole.