Australia adjusted a relatively settled squad for this weekend's second Test, with Yeo the only out following the 26-6 series-opening win.
Penrith prop Lindsay Smith will come into the side for Yeo, with Lindsay Collins elevated to the starting side and Pat Carrigan moving to lock.
But it is Grant's rise to the captaincy that is the most notable for the second Test at Everton's new Hill Dickinson Stadium.
The 27-year-old has led the Storm since the start of last year, with this marking his first time leading a major representative team.
Penrith co-captain Nathan Cleary and Queensland State of Origin skipper Cameron Munster had loomed as the other candidates.
"Harry, and all of the senior players for that matter, stepped up after Isaah's unfortunate injury last week," Kangaroos coach Kevin Walters said.
"While we'd love to have Isaah out there, he'll still be contributing in many other ways around the group this week.Â
"He's a natural leader, and so too is Harry so we're in great hands this week.
"I'm really pleased with the way we've started the series, but we're into a new week now and our focus is preparing well and being at our very best this Saturday."
Yeo will be able to return for the Kangaroos for the third and final Test at Leeds, assuming he passes through all concussion protocols.
England are expected to name their squad later in the week, as they fight to stay in the series and reclaim the Ashes for the first time since 1970.
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