Parliament, which has a consultative role in the appointment, voted 443 in favor with 47 against for Lautenschlaeger, who replaces compatriot Joerg Asmussen.
Lautenschlaeger, 49, is a vice-president in charge of overseeing credit institutions at the German central bank.
Her background will prove useful as the ECB, formally tasked with monetary policy, this year takes on a new role in supervising the banking system of the 18-member eurozone.
The six members of the ECB executive board ― which always has a representative from economic powerhouse Germany ― serve for a single term of eight years.
The executive board sits with the central bank governors from the other eurozone member states to form the ECB governing council.
The last woman on the ECB board was Austrian Gertrude Tumpel-Gugerell between 1998 and 2011 who was replaced by Peter Praet of Belgium in preference to Slovakian Elena Kohutikova.