Holdsworth has been acting head since September and was formerly deputy controller of BBC English regions and head of regional and local programmes for BBC West Midlands.
In the new role, he will oversee 12 regional centres whose output includes daily news programmes, regular current affairs series and regional segments for series such as The Politics Show. He will also take charge of 40 local radio stations and 44 BBC Local websites.
Helen Boaden, director of BBC News, said: “David's commitment to editorial excellence, connecting to all audiences and getting the best out of people shines through. His energy and integrity will be greatly appreciated”
David Holdsworth added: “It's a great time to be working at the heart of local broadcasting as the BBC seeks to better reflect the nations, regions and communities of the UK. My challenge will be to ensure that the BBC remains a relevant high-quality local broadcaster for future generations.”