Mrs Johnston has been an HMI since 1992, latterly heading the Scottish Office's FE funding branch. She was the first woman principal of a Scottish FE college, running Anniesland College in Glasgow for three years until her move to the Scottish Office.
The Fife post, which carries a salary of Pounds 60,000 means a return to an old beat since Mrs Johnston was formerly depute principal at Glenrothes College.
This is the second time that Ray Baker, chairman of the Fife College board, has poached a key figure. As chairman of the Association of Scottish Colleges, Mr Baker helped pick Tom Kelly, head of the Scottish Office higher education division, as chief executive.
Mrs Johnston takes up her new post in October when Derek Huckle retires after 12 years as Fife College's principal.