Petke, 41, takes over from Jeff Cassar, who was fired last week just three games into the new season after a string of disappointing results.
The former MetroStars and Colorado Rapids defender joins Salt Lake from the team's lower league affiliate, Real Monarchs.
"I am honored to be charged with delivering pride and excellence to the passionate RSL fan base," Petke said in a statement.
Petke is best known for his stint in charge of the New York Red Bulls, where he helped the team win its first piece of silverware with the 2013 Supporters Shield.
However, he was fired following the 2014 season -- prompting an angry backlash from fans -- despite helping the team reach the MLS Cup playoffs.
Real have made a stuttering start to the new season, taking just two points from four games to remain near the bottom of the Western Conference.