The shakeup comes as anti-rebel forces struggle to push Iran-backed Huthi insurgents out of the southwestern province of Taez, seen as key to retaking the capital Sanaa.
Abdulmalek al-Mikhlafi, who leads a team of government peace negotiators, was sworn-in as foreign minister, replacing Riad Yassin, the Saba state news agency reported.
The replacement of Yassin, who is said to have good relations with Hadi but not with Prime Minister Khaled Bahah, is understood to be aimed at smoothing relations between the president and the premier.
Among other changes, General Hussein Arab was appointed interior minister, replacing General Abdo al-Huzeifi who will lead the country's intelligence services, Saba said citing presidential decrees.
Hadi also named a new minister of transport, Salah al-Shanfara, who told AFP that he had rejected the nomination.
"I am head of the Supreme Council of the Southern Movement and we are in revolution and will not accept positions," he said, referring to the secessionist movement that wants independence for Yemen's south.
The south was independent between the end of British colonial rule in 1967 and its union with the north in 1990.
The separatists have played a key role in a government-led offensive that has recaptured five southern provinces, including Aden, since July from rebels who overran them earlier this year.
A Saudi-led coalition has been backing pro-Hadi forces since March.
But the pro-government forces have faced fierce resistance in their bid to wrest back control of Taez province and break a siege of loyalists holed up in its provincial capital.
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