The DWP's systems are responsible for many core public sector tasks - such as BACS transactions used to pay wages.
Its new chief technology officer (CTO) will make use of a ?1bn annual budget.
However, one public sector tech expert warned against falling into the trap of big IT overhauls.'Old stuff'
Speaking to Government Computing Magazine, the executive director for the government digital service, Mike Bracken, acknowledged the department's creaking-tech situation.
"Like every part of government, we have lots of old stuff," he said.
"Everyone knows that. DWP, because it's biggest, probably has more than other parts and that stuff is just going to have to be addressed and we're going to do that with them.
"And that's going to be hugely exciting and liberating for that organisation."
Much of the system underpinning the work of the DWP was first developed in the 1970s.
Its maker and maintainer, Fujitsu, describes its system as the "workhorse behind the UK government's revenues and benefits systems".New era
The CTO will receive a ?135,000 salary, and will work under Mayank Prakash, the director general for digital technology at the DWP.
On a mini-site set up to advertise the new role, Mr Prakash said it was "one of the most challenging and rewarding technology roles in the UK today".
As well as moving the DWP away from old tech, the CTO would need to introduce "next generation web, social, mobile, cloud, big data and deep learning technologies" to the mix.
However Mark Ballard, a journalist who writes about public service technology for Computer Weekly, warned against big government IT projects.
"The coalition government lambasted the last lot for big, complex and expensive IT projects," he wrote in an email to the BBC.
"But when you've got an organisation like the DWP which, last time I checked, had 90,000 staff and handled ?70bn of social secuity payments to 8 million households and a operated a national network of job centres to boot, your IT systems are going to be big and complex.
"The coalition originally billed its own Universal Credit as a ?2bn, two-year programme. But it has since slipped out that the budget was ?12bn, and it's taking rather longer than expected. So the coalition is making exactly the same mistakes."
He added: "It aims ultimately to automate government services and deliver them through web apps.
"It hopes this way to cut about 80% of the staff who handle public enquiries in call centres and so on. And it hopes this will help it break up big public bodies such as DWP, to make way for private providers."