Ex-England boss Lancaster appointed Racing 92 coach
Lancaster took his country to a pool stage exit on home soil at the 2015 Rugby World Cup before heading to Dublin a year later as a senior coach.
"Initially it was for just one season and here I am entering my seventh and that is a reflection on all the players past and present I have worked with and the people of Leinster and Ireland who have made me and my family feel so welcome," Lancaster said in a Leinster statement.
"I have always wanted to challenge myself as a coach in different ways and the opportunity to coach in France at a club like Racing 92 is an exciting one and I will look forward to that challenge when it comes," he added.
Lancaster won the 2018 European Champions Cup and the Pro14 title on four occasions in the Irish capital.
He will replace Laurent Travers in Paris with the Frenchman becoming the club's president and current owner Jacky Lorenzetti moving up to board chairman.
Lancaster's successor at England, Eddie Jones, had been linked with the position at La Defense Arena with around 10 people interested in the role.
"We wanted to bring a new way of working, a new vision for training and daily life," Travers told reporters. "A shot in the arm. I think it's necessary."
"It was important for us, we had quite a few candidates, to see those who corresponded the most to help Racing 92 stay at the highest level," he added.
Lancaster has committed to learning basic French before his arrival on July 1 and Racing host the Irish side on the weekend of December 9th-11th in the Champions Cup pool stages.