Chertoff ran the Justice Department's criminal division from 2001 to 2003, before President Bush appointed him to the federal appeals court bench.
"Mike has shown a deep commitment to the cause of justice and an unwavering determination to protect the American people," the president said Tuesday. "Mike has also been a key leader in the war on terror."
Chertoff needs Senate approval to replace Ridge, who announced his resignation Nov. 30.
"He leaves some very deep shoes to fill," Chertoff said of Ridge.
As criminal division chief Chertoff worked on the case of Zacarias Moussaoui, who was branded the "20th hijacker" for his alleged role in the Sept. 11, 2001 terrorist attacks. Chertoff also helped develop the USA Patriot Act, the controversial law that gives law enforcement officials broad powers to monitor and pursue spies and terrorists.
"I will be proud to stand again with the men and women who form our front line against terror," he said.
President Bush's original choice for the Homeland Security job, former New York Police Commissioner Bernard Kerik, withdrew after admitting that he never paid federal taxes for a domestic worker who was an immigrant. Kerik is also being investigated by the city of New York for ties he had with private corporations when he was police commissioner.
The president said Tuesday that Chertoff had been approved three times by the Senate and some lawmakers immediately signaled support for Chertoff.
"Judge Mike Chertoff has the resume to be an excellent Homeland Security secretary, given his law enforcement background and understanding of New York's and America's neglected homeland security needs," said Sen. Charles Schumer, D-N.Y.
Chertoff served as a federal prosecutor in New York and New Jersey from 1983 to 1994, when he returned to private law practice. He also served as chief counsel to Senate Republicans during the Clinton-era Whitewater investigation. In 2001 he returned to the Justice Department.
Chertoff holds a Bachelor's degree and a law degree from Harvard University. Early in his career, Chertoff served as a law clerk to Supreme Court Justice William Brennan.
If confirmed, Chertoff will take over a department employing 180,000 employees across 22 agencies.