The school announced the move in a statement Thursday night, one day after Butch Davis was fired amid an NCAA investigation into improper benefits and academic misconduct in the program.
Chancellor Holden Thorp says Withers "is the right person for our football program under these challenging circumstances."
Withers is a Charlotte native who has been the Tar Heels' defensive coordinator and secondary coach for three seasons.
The school says it will amend his contract for this season to reflect his new responsibilities, and will begin searching for another assistant to complete the staff.
The coaching upheaval comes roughly a week before the Tar Heels begin preseason practice.