The man sacked as Saudi Arabia's energy minister in September was tapped to head a new investment ministry, in a cabinet reshuffle announced on Tuesday that also created ministries for tourism and sports.
Khalid al-Falih, who previously chaired state oil company Saudi Aramco and oversaw more than half the economy of the world's top oil exporter, was widely seen as having fallen out of favor when he was removed from the energy ministry.
Attracting billions of dollars in foreign investment is key to ambitious plans championed by de facto ruler Crown Prince Mohammed bin Salman to end the economy's dependence on crude exports and open up its long-cloistered society.
Falih's new ministry replaces the Saudi Arabian General Investment Authority, whose governor was removed.
Royal orders announced in state media also elevated commissions into ministries for tourism and sports, identified as two big growth areas by Riyadh.
The civil service ministry, which is responsible for millions of public employees was merged into the labor ministry.