Simo, 35, who joined the San Francisco company's board in January, succeeds Instacart Co-Founder Apoorva Mehta.
Mehta, 34, becomes executive chairman and will report to the board.
“Seven months ago, I invited Fidji to join Instacart’s board, and since then I’ve been blown away by her capabilities as a leader,” Mehta said in a statement.
“Over the last decade at Facebook, she’s been a part of every big moment in the company’s history, including helping it grow from 1,000 to nearly 100,000 people and leading the world’s most popular app.”
There is talk in the stock market that Instacart will go public in a direct listing late this year. It was valued at $39 billion in its most recent funding round, in March.
That made Instacart the second most valuable privately held company after Elon Musk’s SpaceX, which was valued at $74 billion then, according to CNBC.
In other Facebook-related news, last month it won a court victory when a judge dismissed two antitrust suits filed by the federal government and a group of states against the social media colossus.
U.S. District Judge James Boasberg in Washington said the Federal Trade Commission didn’t prove that Facebook represents a monopoly in the social networking space.
“Although the court does not agree with all of Facebook’s contentions here, it ultimately concurs that the agency’s complaint is legally insufficient and must therefore be dismissed,” Boasberg wrote, according to Bloomberg.