Iniesta was at the heart of the Spain and Barcelona midfield during a period of sustained success for both teams in the late 2000s and early 2010s, and scored the winning goal in the 2010 World Cup final.
"Having obtained his A Licence, the World Cup winner and Champions League-decorated midfielder has joined as head coach ... as he progresses towards his Pro Licence and takes his first steps on the touchline," the UAE First Division League side said in a statement on Monday.
Iniesta retired in 2024 and last played at Emirates Club in the UAE.
"Joining Gulf United FC feels like the right place to begin this new chapter," the 42-year-old said.
"Football has given me everything, and now I want to give something back through coaching, through learning, and through working every day with young players who have the hunger and the talent to go far."