The 50-year-old succeeds Luiz Felipe Scolari to return for his second stint with the Selecao after a largely successful four years in charge between 2006 and 2010Brazil's football federation (CBF) has confirmed the appointment of Dunga as the new Brazil coach.
The 1994 World Cup-winning captain returns for what will be his second stint in charge of the Selecao, having spent four years at the helm between 2006 and 2010.
He succeeds Luiz Felipe Scolari, who left the post after failing to claim Brazil's first World Cup on home soil following a humbling 7-1 defeat to Germany in the semi-finals.
In Dunga's previous spell in charge of his country, he won 42 and lost just six of his 60 games, guiding them to the Copa America 2007 and Confederations Cup 2009 titles, but was criticised for his pragmatic approach.
The 50-year-old was fired from what was his first senior coaching role in 2010 after suffering a World Cup quarter-final defeat to the Netherlands.
Dunga’s only other experience in the dugout came at Brazilian club Internacional last year, but he lasted less than 12 months before being dismissed after suffering four straight league defeats.
His first Brazil squad will be announced in late August ahead of the Selecao’s Gillette Brasil Global Tour friendly fixtures with Colombia and Ecuador in the United States.