The move comes after Christie's own lawyers investigated the Bridgegate scandal and called for dramatic change at the troubled agency.
"I wanted someone with unquestionable credentials both politically, from partisan perspective and from, most importantly, issue of integrity," Christie said.
John Degnan will replace David Samson, who resigned as chairman last month after questions about his integrity and about what role Samson played in the bridge scandal.
Degnan says the governor's giving him free reign to try and clean up the Port Authority.
"I have the governor's mandate to be independent and open-minded about the task for which I'm very grateful," Degnan said.
Democrats responded positively.
"As I said this is a good appointment so I give the Governor a gold star in that column," Sen. Loretta Weinberg, co-chairman of the Investigative Committee investigating Bridgegate, said.
Still, Weinberg said Degnan has his work cut out for him. She says the governor helped create the climate where dirty politics like bridgegate could flourish.
"But none of this would have happened if this atmosphere hadn't been created in this state of New Jersey. That is clear and simple. The Governor can't deny it," Weinberg said.
Governor Christie is attempting to move beyond this scandal and get back to governing and the possibility of a run for the white house. Tuesday's appointment may help.
"Over his career, John has shown over and over again he's willing to put service to the state and its people before partisan politics," Christie said.
Degnan, a registered Democrat who served as attorney general from 1978 to 1981.