Starting on 12 March, the ex-Kiss breakfast DJ, whose frank on-air discussions about sex helped land the Emap-owned station a record £175,000 fine, will host a three-hour show from Monday to Friday.
He will also continue to host his daily downloadable show, Bam Bam Daily, which he launched in September last year.
Bam Bam, real name Peter Poulton, said: 'This is a move that I have quietly hoped for nearly 3 years. I'm joining a very impressive team at Capital 95.8 and I can't wait to get back on the air in London. I've spent a lot of time with programme director Scott Muller and his grasp on radio is far superior to any other programmer I've ever worked with.'
Gillies will remain on the station as the host of a show yet to be announced.