Glue London won the business after a head-to-head pitch against the incumbent Netdecisions. Its launch campaign will see it take over all the advertising spots on Yahoo!'s website to advertise the brand.
Creative, which will include rich-media executions that float across the web page, will be themed to fit with specific sections of the portal.
For example, the New Taste Menu will be pushed as a "winning team" in the sports section or "good value" in the finance sections of the portal.
The agency's online work will complement above-the-line advertising, developed by Leo Burnett, which uses the strapline: "Things that make you go Mmmmm."
The fast-food giant's decision comes in response to declining sales and increased competition. It has already tried to shed its links with youth obesity by providing fruit as an option in its outlets. Its new items include a pasta salad with chicken.
Last year, McDonald's announced it intended to scale back its global expansion plans and open only 600 new restaurants this year, down from a peak of 2,000 in 1996.
In December, Jack Greenberg, the chairman and chief executive of McDonald's, resigned after 21 years with the company.
Starcom remains McDonald's media planning and buying agency.
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