Sources told ESPN that Scott agreed to a four-year, $17 million contract with the Lakers, who hold a team option on the final year of the deal.
Scott confirmed the agreement to KCBS-TV on Saturday night.
"It feels fantastic," he told KCBS-TV. "This is a dream come true. I always wanted to coach the Lakers, especially when I got to coaching. It's so unreal. I have to thank [general manager] Mitch [Kupchak], Jeanie and Jim Buss to give me this opportunity."
Scott has been the front-runner for the job throughout most of the nearly three-month coaching search, which began when Mike D'Antoni resigned on April 30. His status as a three-time champion with the team during the Showtime era, his close relationship with Kobe Bryant and his familiarity with the current roster after having worked as an analyst all of last season for the Lakers television station, Time Warner Cable SportsNet, gave him the early edge.
Scott then impressed Lakers management during three interviews, the last of which took place after the team's roster had been filled out and Scott was given a chance to articulate his vision for the current personnel.
The Lakers were impressed by Scott's reputation as a disciplinarian, believing that temperament to be the right fit for a young team and able to take some pressure off Bryant in that area.
The Lakers interviewed a handful of candidates for the job, but after making quick hires in their past two coaching searches, the franchise decided to prioritize the draft and free agency over hiring a coach.
The Lakers had contacted five coaches besides Scott about the position -- Mike Dunleavy, Kurt Rambis, Alvin Gentry, Lionel Hollins and ESPN NBA analyst George Karl.
Three of those candidates soon accepted new jobs after talking to the Lakers. Hollins was hired as coach of the Brooklyn Nets after Jason Kidd bolted for the Milwaukee Bucks, while Gentry (Golden State Warriors) and Rambis (New York Knicks) accepted associate head-coaching positions.
Bryant, who played with Scott in 1996 during his rookie season, offered a key endorsement during his basketball camp in Santa Barbara, California, three weeks ago.
"He was my rookie mentor when I first came into the league," Bryant said. "So I had to do things like get his doughnuts and run errands for him and things like that. We've had a tremendously close relationship throughout the years. So, obviously, I know him extremely well. He knows me extremely well. I've always been a fan of his."
ESPNLosAngeles.com's Dave McMenamin and ESPN the Magazine's Chris Broussard contributed to this report.
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