Under marketing director David Roth, the DIY retailer has divided its marketing team into two divisions: brand marketing and special order.
Leahy, who left B&Q for WH Smith two years ago to be marketing unit director, joins as director of brand marketing and will front the development of what B&Q is calling "new and stronger campaigns" for 2004.
This will include overseeing its £32m advertising account, handled by J Walter Thompson, which was appointed in June, and in-store material.
B&Q is the UK's 35th-biggest advertiser.
Roth has appointed B&Q International's director of commercial, Justin Lees, to the new role of director of special order marketing. He will be responsible for developing the mail-order side of the business.
Both Leahy and Lees will report to Roth. The shake-up is thought to have been the reason behind the axing of director of marketing operations Breffni Walsh earlier this month, after just 15 months in the role (Marketing, November 13).
Separately, B&Q chief executive Bill Whiting is retiring and will be replaced by managing director, commercial, Rob Cissell.
The restructure comes as B&Q prepares for the crucial Christmas season.
Sales at the chain remain strong: this month B&Q unveiled a 2.7% rise on like-for-like sales for the 13 weeks to November 1.
Leahy has been replaced at WH Smith by brand communications director and former Ocado marketer Katie Spriggs, who joined the high-street retailer last month.
Leahy reported to WH Smith retail brand director Muriel Stirling. He led a team of 33 marketers across advertising, brand strategy, in-store promotion, Clubcard, direct marketing, events and PR.
Last month, WH Smith reported poor trading figures. UK retail sales were down 2% to £1.48bn in the year to the end of August.