Kelly led the US Southern Command, covering US military operations in Central and South America and the Caribbean
"General John Kelly's decades of military service and deep commitment to fighting the threat of terrorism inside our borders makes him the ideal choice to serve as our Secretary of the Department of Homeland Security," Trump said in a statement.
"He is the right person to spearhead the urgent mission of stopping illegal immigration and securing our borders, streamlining TSA (Transportation Security Administration) and improving coordination between our intelligence and law enforcement agencies," Trump said.
Kelly led the US Southern Command, covering US military operations in Central and South America and the Caribbean, including efforts to stem the flow of illegal drugs across the US southern border and end human trafficking.
"I am humbled and grateful to be nominated to serve in President-elect Trump's cabinet as Homeland Security Secretary," Kelly said in the statement issued by the president-elect.
"The American people voted in this election to stop terrorism, take back sovereignty at our borders, and put a stop to political correctness that for too long has dictated our approach to national security.
"I will tackle those issues with a seriousness of purpose and a deep respect for our laws and Constitution. I am honored for the opportunity to be back in the service to our country, and our people."
The third general chosen for Trump's cabinet, Kelly spent 45 years in the US Marines, holding a range of positions from field commands in Iraq to political liaison in Congress before finishing his career as commander of the US armed forces Southern Command.