The 43-year-old won 19 caps for Wales between 1999 and 2000, playing in the last World Cup of the 20th century having previously represented his native New Zealand on four occasions.
Howarth scored 23 points for Wales as well as 1,035 for Newport in a four-year spell that ended with his retirement in 2003.
The fly-half cum full back returned to New Zealand after saying goodbye to Rodney Parade and has since enjoyed a varied coaching career in the southern hemisphere.
Howarth's coaching CV includes roles as head coach of Auckland's NPC side and assistant coach at Super Rugby outfit Auckland Blues and the New Zealand Maori, as well as additional experience with the Pacific Islanders and the Papua new Guinea Sevens side.
"I've followed Shane's coaching career since I played with him for Wales and he comes strongly recommended from the like of Graham Henry," said Wasps boss Young.
"We have a similar philosophy on the game and I think we will hugely benefit from his intimate knowledge of both the northern and southern hemisphere."
Howarth will begin his role next month, taking over from former Dragons coach Paul Turner who is leaving to develop his own coaching consultancy business after a year in High Wycombe.