Harsley joins the Blues from Barnsley, where he held a similar role and was briefly the Tykes’ caretaker manager earlier this year.
Harsley enjoyed a 17-year playing career, making 500 appearances with several clubs including Port Vale, Macclesfield Town and Scunthorpe United.
He takes over from Simon Davies who moves to the role of Head of Coaching Under-13s to U23s.
Academy Director Jason Wilcox said: “We are delighted to welcome Paul to the role of EDS manager.
“He is a forward-thinking coach who has had an extensive playing career and comes to us with an excellent reputation of working with young players.
“He is a great addition to our coaching staff and he is inheriting a talented group of players.”