Bert van Marwijk was tipped to achieve "great things" with Australia on Thursday as he was given the job of taking the Socceroos to the World Cup, following Ange Postecoglou's sudden departure.
The Dutchman, who took the Netherlands to the 2010 World Cup final, had been one of the leading foreign candidates to take on the short-term coaching stint.
Local media said he was being paid just over Aus$1 million (almost Dh3 million) for a five-month contract, with a minimum of Aus$500,000 in bonuses if the Socceroos advance beyond the group stage.
Van Marwijk was sacked by the Netherlands after they failed to win a point at Euro 2012. He led Saudi Arabia to qualification for this year's World Cup in Russia but left in September over a contract dispute.
"This is a great result for Australian football," FFA chairman Steven Lowy said in a statement.
"He knows a lot about our team and how they play because he studied them closely as an opposition manager in the same [World Cup qualifying] group. These experiences make him a compelling choice.
"In Bert van Marwijk we have a manager who can achieve great things with this team."
The 65-year-old Dutchman takes the reins after Postecoglou quit in November despite successfully guiding the Socceroos to the World Cup via the play-offs.
Van Marwijk, who has also coached Dutch club Feyenoord, and Bundesliga sides Borussia Dortmund and Hamburg, said Australia "are not going to Russia just to be competitive".
"I want to win our matches," he added. Australia will play France, Denmark and Peru in Group C, starting on June 16.
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Van Marwijk is not the first Dutchman to coach the Socceroos, with Guus Hiddink and Pim Verbeek previously taking the reins.
Hiddink famously took an Australia side featuring Mark Viduka, Harry Kewell and Tim Cahill to the last 16 at the 2006 World Cup, their best performance in four attempts.
Cahill, now 38 and Australia's record scorer, remains a talisman of the team that needed two-legged playoff wins over Syria and Honduras to seal their third straight World Cup berth.
Van Marwijk's appointment could last only for the World Cup, as the FFA said arrangements for the coaching role after the tournament "will be announced in the near future".
Leading Australian contender Graham Arnold earlier this week ruled himself out of the job, but kept the door open to a stint with the Socceroos in the future.
Sydney FC said Arnold would remain as manager at the A-League club until the end of the season, which finishes in May.
Van Marwijk's coaching style is a departure from the so-called Dutch way of stylish football. His approach is seen as pragmatic, with a focus on results rather than attractive play.
Socceroos midfielder Mark Milligan, who plays for Melbourne Victory, said Thursday that Van Marwijk's experience and competitiveness would be a "very good fit" for the national side.
"With his history, we know how competitive he is and how he leads his teams, and I think it will be a very good fit for the players that we have," he told the A-League's website.
"The success he had there [coaching Saudi Arabia] was unbelievable ... I think that's a positive sign for us."
Arnold backed the FFA's decision and said his appointment was "fantastic".
Others were less complimentary about Van Marwijk's style, describing his appointment as an uninspiring but practical choice.
Writing for public broadcaster SBS, football analyst Sebastian Hassett said the FFA had reverted to the familiar by selecting another Dutch managerh, adding that the appointment was a "win for the pragmatists".
"You know what you get with him. Simple football, loaded with physicality. Short back and sides. Results-focused. But he has also been given a basic metric: get us to the second round of the World Cup," he wrote.
"The Socceroos won't win any plaudits for their playing style but they will rediscover their elbows and studs. If you like a harder edge, you'll like this."
Van Marwijk's first games as manager will be two friendlies against Norway and Colombia in Europe in March.