Simeone starts over by returning to Racing
"I don't see this as a step backwards, to come back here from Italy," Simeone, who finished playing and began his career as a coach at Racing in 2006, said at his unveiling on Tuesday.
"The [initial] objective is to get into a cup [competition], which we haven't done for a long time... hopefully other things will follow," Simeone, succeeding Miguel Angel Russo who resigned last week, told a news conference.
The 41-year-old steered Catania clear of relegation in his four-and-a-half-months in charge and left by mutual consent.
Simeone, who won 106 caps and played at three World Cups, coached Racing for 14 matches in 2006. He later won league titles with Estudiantes and River Plate and also coached San Lorenzo.
He began his playing career at Velez Sarsfield, moving to Pisa in 1990 and then on to Sevilla, Atletico Madrid, Inter Milan and Lazio.
Racing were 15th in the Clausura championship which ended last weekend when they lost 2-1 at champions Velez, their fifth match without a win which cost them a place in the Copa Sudamericana, South America's Europa League equivalent.