The 55-year-old Croatian will replace his compatriot Luka Bonacic in the Isfahan-based team for the rest of the season.
Kranjcar will join Sepahan in a deal rumored to be worth $400,000.
Sepahan is fifth on Iran Professional League standings table with five points behind pacesetter Esteghlal.
Kranjcar was appointed as coach of Persepolis in July 2009 after signed a two years contract. He was sacked by the Iranian club in the wake of poor results in the league in September 2009.
