The former Scotland midfielder will be assisted by Gordon Young - who has worked with the likes of Dundee United and Motherwell - while Tam Ritchie joins as fitness coach.
Hartley, who was previously in charge of Alloa Athletic, Dundee and Falkirk, takes over from co-managers John Sheran and Graeme Mathieson, with the former becoming director of football.
Cove chairman Keith Moorhouse told the club website: “The changes to our management team were imposed upon us after John decided he could no longer continue as co-manager. We appreciate everything that John and Graeme have done for the club and saw this as an opportunity to bring in an experienced SPFL management team with a proven track record.
“We are delighted to appoint our first full-time football manager and believe that Paul has everything required to ensure that we are prepared for life in the SPFL.”
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