The ex-Villa boss returns to the club in an advisory role.
The 62-year-old, who played for and managed the club, was appointed as an advisor to the board on Friday evening.
"I'm delighted to have been invited to assist the board," he told Villa's official website.
"I've held various roles at the football club over a 46 year period and I know my experience and love for the Club will help shape a positive future for Aston Villa."
Along with Little, former Football Association chairman David Bernstein also joined Villa this evening, with the 72-year-old becoming a board member effective immediately.
Both appointments come one day after the Villans posted pre-tax losses of £27 million to the year ending May 31, 2015, which upset former striker Ian Taylor.
Little was a one-team man during his playing days and spent 10 years with Villa, before a knee injury forced his retirement in 1980, at the age of just 26.
He returned as a manager in 1994 and led the club to League Cup glory in 1996, leaving two years later.
The club might well need his experience and wisdom next season as they face the increasingly likely prospect of life in the Championship, with Remi Garde's side rock bottom of the Premier League and nine points from safety