The Korean manufacturer announced last September that it would end a long break from the series with a full-time return to competition in 2014 based around its i20 model.
Nandan, who designed the world championship-winning Peugeot 206 WRC and also engineered Suzuki's SX4 WRC, has now been brought on board to lead the project. It is his first team principal role.
Nandan said: "I am honoured to have been chosen by Hyundai to spearhead its exciting new entry into the WRC.
"The project is still in its infancy, but things are moving rapidly, and I am looking forward to developing the team as this year progresses.
"There is much to be done, of that we are fully aware, but with an ambitious core of highly motivated personnel, we are already making good progress."
Hyundai, which has been testing the i20 in Europe since December also announced that its WRC programme will be run in-house by the newly-created Hyundai Motorsport GmbH.
The team will be based at a dedicated in-house facility at Alzenau, just outside Frankfurt.
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