Smith had been head of youth development at Walsall since 2009
Dean Smith has been appointed Walsall manager until the end of the season following an encouraging three games in charge as caretaker boss.
After taking over from Chris Hutchings following his dismissal on 3 January, Smith, 39, guided Walsall to valuable draws at Tranmere and Bristol Rovers.
The Saddlers then lost 4-2 at home to high-flying Huddersfield last Saturday.
Smith told BBC WM: "I know the position we are in and what we need to do, I'm looking forward to the fight."
He added: "A lot of people have said congratulations, I'd rather get good lucks then congratulations, because we need some luck along the way.
"I've really enjoyed the three games so far and I'm looking forward to going on from there and producing the kind of performances that we put in against Huddersfield - but with the results."
West Bromwich-born Smith, who had been the club's head of youth after returning to Bescot following four years as assistant to Martin Ling at Orient, beat off 90 other applicants.
He faces a tall order, with Walsall currently propping up the League One table, seven points and a healthy goal difference away from safety.
But chief executive Stefan Gamble says that the club are in good hands under the former Hereford, Leyton Orient, Sheffield Wednesday and Port Vale defender, who started his career with Walsall at Fellows Park way back in 1989.
"We are really pleased to have Dean on board on a full-time basis," said Gamble.
"The rest of the board and I have been very impressed with how he has conducted himself since taking over the first-team reins.
This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.