Sinofsky, who has been with the company for 20 years, was senior vice president of the Windows engineering group and before that oversaw Microsoft's Office products.
He's been credited with improving the development process for Windows 7, compared to its long-delayed and under-performing predecessor, Vista.
"It's basically a promotion for Sinofsky after doing great work getting Windows development back on track with Windows 7," said Matt Rosoff, an analyst at Directions on Microsoft.
Windows 7 is due to launch commercially in October. Microsoft has recently been talking up the smooth development and release schedule for Windows 7 compared to the process for previous operating systems.
It's unclear what role Sinofsky's colleague Bill Veghte will assume. Veghte was senior vice president in charge of Windows, a parallel position to Sinofsky's former role. In a statement, Microsoft said Veghte will move into a new leadership role to be announced later this year.
Sometimes at Microsoft, such a delay in repositioning an executive signals that the person will soon leave the company. "Perhaps Veghte was hoping for this role [of Windows division president] and was disappointed when he didn't get it. Veghte has moved around within Microsoft quite a bit, though, so it wouldn't surprise me if there's another role for him somewhere," Rosoff said.
In the meantime, Tami Reller, chief financial officer for the Windows division, will take on his marketing responsibilities while retaining her financial duties. She'll report to Sinofsky.
Reller came to Microsoft with the acquisition of Great Plains Software, where she also served as CFO.
Sinofsky, who becomes one of five presidents at Microsoft, takes on the new responsibility not only just in time for the important release of Windows 7, but also as the OS faces potentially significant looming competition.
On Tuesday, Google announced that it is developing an open-source operating system for PCs and netbooks that will be tied closely to its Chrome browser. The concept may be along similar lines as a project developed in Microsoft Research called Gazelle, which seeks to add more capabilities to browsers so that they can function as an operating system.