The former Wales goalkeeper announced his retirement on Thursday.
It was later revealed in the evening that Hennessey would be added to Forest's coaching staff as an assistant to senior keeper coach Rui Barbosa.
Hennessey told Forest's website: “I am delighted to continue my journey at the Club as part of the coaching staff. I really enjoyed my time as a player here and working with this incredible group.
“This marks a new chapter in my career, and I’m really looking forward to getting started in the role to help the team towards its goals.”
Chief Football Officer, Ross Wilson, said: “Everyone at the Club is pleased Wayne is staying with us in a coaching capacity. While his playing career speaks for itself, Wayne brings a lot to the goalkeeping group off the pitch and will now work with Rui Barbosa and the team to further develop our keepers.
“Matz had a great season last year, and he undoubtedly benefits from the support and guidance of someone like Wayne, who has significant experience at the top level.”