Holmes, who quit his £450,000-a-year job at GMTV in January after 12 years, will host the 4pm to 7pm afternoon show from September 18.
The Irish broadcaster admits to being a big Elvis fan, but said he has an extremely eclectic taste in music.
"I suppose that everyone knows that I am a big Elvis fan, but when I appeared as Johnny Cash on 'Celebrity Stars in Their Eyes' people could see that I have a great love of music in general.
"I love my iPod and just flicking through I have everything from Alanis Morissette to Maroon 5," he said.
Andria Vidler, managing director of Magic FM, said signing Holmes was part of a plan to add more high-profile presenters to the station.
"Magic is all about offering the listener the best possible music whenever they tune in. More music, less talk remains the ethos of Magic but by introducing a few high-quality shows into the schedule we will be adding some talkability," she said.
The station also announced it was rolling out a new marketing campaign in the autumn in an attempt to turn Magic FM into London's number one commercial radio station.
Magic's currrent ad campaign, launched last year by St Luke's, is set to Dido's 'White Flag' and features a number of lookalikes going about their lives as a car drives down a city street.
There is a dustman resembling Mick Hucknall who wanders across the road while Lionel Ritchie appears in front of a florist. The driver slows down for Kylie on her way to work as a beautician. Will Young appears outside a hair salon and Phil Collins is a paper seller. George Michael appears in uniform as a traffic warden. All the stars, representing core Magic artists, are played by lookalikes.
According to the latest set of Rajars, Magic FM is the third most popular radio station in London. It attracted a record 1.73m listeners, adding 133,000 in the latest quarter to May. Heart and Capital occupy the top two spots respectively.
Since leaving GMTV at the beginning of the year, blaming early morning starts and wanting to spend more time with his family, Holmes was snapped up in a deal worth £2m to front the Sky News' morning show 'Sky Sunrise' for three years.
Before joining GMTV, Holmes spent six years working as a reporter on Ulster Television, having begun his career as a reporter in Northern Ireland.
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