Patterson was sacked as manager of Blue Square Premier side Oxford last November and is now relishing the prospect of a new challenge at the Memorial Stadium, which will start on July 1.
"I am very excited to have got things sorted and am looking forward to getting cracking," he told the club's official website.
"It is fresh for everybody and it is a big challenge for everybody, not only the staff but the players as well.
"I will be teaching them how to win but the biggest thing that got me the job is that I produce kids. I want these kids through into the first team.
"They need to have a winning mentality otherwise they won't last long. Producing players is most important but winning comes a very, very close second.
"I look forward to working with everybody and hopefully in years to come we can get some good kids through."