Stuart Foster, Nottinghamshire's cricket chairman, said: ``Everybody we spoke to said that Clive was the man for the job, and so we were determined to bring him back to Trent Bridge this time.
``We feel it's his great passion and strength of leadership which we need to get this club back to where we belong as a major force in county cricket.''
Rice, a former Test all-rounder and Nottinghamshire captain, will give up his role as director of South Africa's national cricket academy during the English season.
He said: ``I want to see the good times return to Trent Bridge again, and this is a fantastic opportunity to play a prominent role in achieving that objective. We managed to turn the wheel of fortune in the 1980s and I'm sure we can do it again.''
Courtney Walsh has asked for more time to consider Gloucestershire's offer of a new two-year contract.
Walsh, the leading wicket-taker in the championship last season with 106, would have to make himself unavailable for West Indies in next year's World Cup if he accepts the offer.