MacDonald, had been Villa's reserve team manager when he was given the role of caretaker manager at Villa Park following the departure of Martin O'Neill.
After Villa's 1-0 win over Everton yesterday, a statement about the manager's job was released. It read: "To date, we have immersed ourselves in the process of appointing a new manager and clearly identifying the key criteria this person must meet.
"Two of the traits we believe are of crucial importance are that candidates have experience of managing in the Premier League and a strategy for building on the existing strengths in our current squad.
"We have thoroughly researched potential candidates and have reached out to a variety of contacts we have within the game for advice and guidance, as well as keeping key staff at Villa Park informed and focused.
"We will now start the process of interviewing candidates we believe meet the key criteria required to manage Aston Villa with a view to making an appointment in the near future.
"Kevin MacDonald will continue as caretaker manager until that time.
"Finally, we wish to make clear that our relative inactivity in the transfer market this window in no way reflects a change in direction or dilution of ambition for the club, but rather our reluctance to make decisions on players without a permanent manager in place."