The DCLG's director-general for localism has responsibility for local government, communities and the big society.
Edwards began her civil service career at the Home Office in 2002, serving as the director of the department's active communities directorate, and then later as the director-general of the Home Office's communities group.
From 2006 to 2008, Edwards was chief executive of the National Offender Management Service.
Before joining the civil service, Edwards - a trained social worker - worked for Save the Children and at Nacro, the crime reduction charity, where she spent five years as chief executive.
Edwards said: "I am very pleased to be joining DCLG at such an exciting and challenging time. I welcome the opportunity to take forward the localism agenda and to renew my relationship with those working in local government and in the voluntary and community sector as well as building relationships more widely."
Edwards replaces David Prout, who earlier this year moved from the DCLG to the Department for Transport to take charge of the HS2 project.
Simon Ridley has been acting director-general for localism since 7 January.
Sir Bob Kerslake, DCLG permanent secretary, said: "I’m absolutely delighted that Helen is joining DCLG. She brings a wealth of experience at senior level and has worked with both local government and the voluntary and community sector in her career. She will be a great addition to the department. I’d like to thank Simon Ridley for the excellent job he has done."