The stylish batsman and useful medium-pacer from Otago replaces Watkins, who retired after the quadrangular series held in England earlier in the year.
In 40 one-day matches, 24 year-old Bates has amassed 1065 runs and 33 wickets while in 34 Twenty20 internationals she's struck 715 runs and picked up 23 wickets.
Bates is also one of the more capable fielders in women's cricket, taking 23 catches since making her international debut in 2006.
The 24-year-old will first lead the White Ferns in the Rose Bowl against Australia starting on January 20 in a series comprising of five Twenty20 internationals and three one-day internationals before the team face England at home later in the summer.
White Ferns' coach Gary Stead said Bates had shown the characteristics required to successfully lead the national team.
"Suzie thinks a lot about the game and is quick to offer tactical input during meetings and out on the field,'' he said.
"She is a natural leader who has had a positive influence on the younger members of the squad over the past few years and is someone other players look up to. That's important with the current squad as we go through a rebuilding phase.''
Bates, who has also represented New Zealand in basketball, said it was a huge honour and a truly wonderful privilege to be handed the White Ferns' captaincy and she was humbled to be offered the job.
"I'm aware of the responsibility that comes with the position and am looking forward to the challenge ahead.''
