The 46-year-old has spent the past four seasons coaching in some of the top leagues in Europe, winning the DEL2 Coach of the Year in 2018-19.
Neilson has a proud association with the Panthers, winning two trophies as a player before creating a dynasty after taking up the role as coach in 2008.
He went onto win four play-off titles and six Challenge Cups, led Panthers to the much-coveted Elite League title and helped the club become the first British side to have trophy success in Europe by winning the Continental Cup.
Neilson said: “The call to come back to Nottingham was strong. I am looking forward to the challenge.
“I have been watching Panthers as a fan from afar for five years now, doing my stuff in different countries and trying to improve myself.
“I saw that Panthers were struggling a little bit and I wanted to be part of that solution.
“I want things to be better. I love the Nottingham Panthers, I always have – ever since I walked through the door. I think this is a great opportunity to take some positive strides.”
Neilson is also part of the Great Britain coaching set-up as Assistant Coach and was part of the team that won back-to-back promotions to the top flight of the IIHF World Championship.
Panthers CEO, Omar Pacha, said: “There is still a lot of hockey left this season and it was crucial at this point of the season to get a person that not only knows the EIHL, but was very successful in this league.
“By having success in Europe and getting more experience, I am confident we are getting the best version of Corey Neilson to put us back in a forward trend as a club.
“His communication style and attention to detail is what sets him apart from the rest and he is familiar with some of the players in our dressing room.
“I truly believe he’s the best man for this job. It’s a great added bonus that he loves the club. He knows what it means to the supporters and understands what it means to lead the Panthers.
“Ironically, the club has not won a trophy since he left apart from the Elite Series but this isn’t about the past. Corey is the man to lead us forward and we share the same visions. He has so much experience, is a proven winner and is a great fit for this hockey club.”