The nomination, announced by Trump on Truth Social, came six months after the president withdrew his initial nomination of Isaacman to lead NASA amid a bitter row with Musk.
If confirmed by the Senate, Isaacman would replace Transportation Secretary Sean Duffy, who has served as interim administrator of the National Aeronautics and Space Administration.
"Jared's passion for Space, astronaut experience, and dedication to pushing the boundaries of exploration, unlocking the mysteries of the universe, and advancing the new Space economy, make him ideally suited to lead NASA," Trump said in his post.
Isaacman in May was yanked as the choice to lead NASA just as Musk and Trump were falling out over the president's "big beautiful" domestic policy mega-bill.
The White House at the time pointed to Isaacman's previous support of Democrats, even if the move was widely interpreted as a snub of Musk.
Following Trump's announcement Tuesday, Musk posted on X emojis of a heart, rocket and US flag over a screengrab of Trump's announcement of Isaacman's renomination.
Musk, the world's richest person, was almost inseparable from Trump as he headed the cost-cutting "Department of Government Efficiency," or DOGE, but the pair later fell out bitterly over government spending plans under the Trump-led budget.
Musk had reportedly lobbied directly with the president for Isaacman to get the top NASA job, raising questions of possible conflicts of interest.
Isaacman, an accomplished pilot, made history as the first private citizen to conduct a spacewalk during SpaceX's Polaris Dawn mission in September 2024.
The 42-year-old founder and CEO of Shift4 Payments has flown multiple private space missions aboard Musk's SpaceX rockets and has been a key customer and advocate for the company's space exploration goals.
The appointment requires Senate confirmation.
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