The military-installed government announced Sisi's promotion on Monday without going into details.
However, security officials said it was a sign he is about to announce his candidacy for the presidency.
"The decision was expected and it is the first step before the resignation of the general and his candidacy announcement which is now expected very soon," a security official said.
Under law, a current member of the military cannot run for the country’s top spot.
The move comes after Egypt’s interim President Adly Mansour announced on Sunday that the presidential election will be held ahead of the parliamentary vote.
Meanwhile, tens of thousands of Muslim Brotherhood activists and their supporters staged nationwide demonstrations on Saturday to mark the anniversary of the 2011 revolution that toppled former dictator Hosni Mubarak.
The demonstrators demanded ousted President Mohammad Morsi’s reinstatement and called for the release of Brotherhood activists arrested by police.
RA/NJF