Barlow, described by international media as "the Al Gore of water'' and currently chair of the country's biggest public advocacy group, the Council of Canadians, will work directly with president Father Miguel d'Escoto Brockmann, who was elected to the 63rd general assembly in June.
The new position was created to address what Brockmann outlined as one of six priority issues during his tenure: Achieving the goals of the United Nations Decade Water for Life program, which began in 2005 and ends 2015.
"It was the result of her work with the UN, her Blue Planet project and the robust body of work she's done,'' said Dylan Penner, council spokesperson.
Barlow founded the Blue Planet Project, a movement described as an "international civil society movement,'' aiming to protect the world's fresh water from threats of trade and privatization.
Barlow will also work with the UN president to push forward a resolution that would force countries to recognize water as a basic human right -- a motion Canada blocked this year, citing fears of water sovereignty.
About two billion people live in the world's water-stressed regions and a child dies every 20 seconds from water-borne diseases, according to UN statistics.
Barlow is a decorated activist, holding six honorary doctorates and with 16 books bearing her name. Her latest, Blue Covenant: The Global Water Crisis and the Coming Battle for the Right to Water, was endorsed by actor Robert Redford. Most recently, she received the Citation of Lifetime Achievement from the Canadian Environment Awards and, in her acceptance speech, denounced sponsor Shell Canada for their environmental record.