The new division is being set up to service the agency's Procter & Gamble haircare and beauty range, including the Clairol, Wella and Max Factor brands.
It will open on 1 March with offices in London, New York and Tokyo. These will be followed by a further three offices in Buenos Aires, Beirut and Shanghai.
Once up and running, the agency will set out to attract non-P&G business.
Bruce Haines, the chief executive of Leo Burnett, said: "There is already interest from another luxury brand that we are hoping to sign up very soon."
Based in Burnett's offices, the London arm will be headed by Robin Harvey, the former head of JWT's Label. It will be staffed by a team of 15 people, eight of whom will be creatives.
Harvey began his career as an art director at Conde Nast on the fashion magazine Harpers & Queen. He continued with similar positions at various publishing houses around the globe until 1999.
He then joined Label at JWT London, where he worked as a creative director with clients including Warehouse and Monsoon and was responsible for repositioning the Rimmel brand.
Haines said: "In the area of beauty, haircare and prestige brands, there are certain rules you need to know and understand that are sometimes not accepted easily by non-specialists. In Robin we have someone with proven ability who understands this sector."
In the past month, both M&C Saatchi and Miles Calcraft Briginshaw Duffy have launched luxury arms. The former is provisionally titled M&C Lux, while the latter will be named Brand Couture.
All three offerings are designed to give clients a media-neutral offering comprising traditional advertising, public relations and event marketing for luxury brands.