"Tom and I have decided to work together. It worked well and we'll do it this year," the Thiem told Austria's Servus TV station.
Muster, 52, has been serving as captain of the Austrian team at this week's inaugural ATP Cup in Australia.
He trained alongside the world number four ahead of the event and will make himself available for 20 weeks this year while working with Thiem's coach, Nicolas Massu.
The 26-year-old Thiem has reached the final at Roland Garros the past two seasons, losing twice to Rafael Nadal, and finished runner-up at the ATP Finals last November.
Muster, who spent six weeks at number one in 1996, will form part of Thiem's support staff at the Grand Slams and Masters 1000 tournaments.