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Chelsea have appointed former Liverpool boss Rafael Benitez as interim manager until the end of the season.
Previous manager Roberto Di Matteo was sacked on Wednesday following the 3-0 Champions League defeat by Juventus.
Benitez's short-term appointment could pave the way for owner Roman Abramovich to make a summer approach for ex-Barcelona coach Pep Guardiola.
Benitez, 52, becomes the Blues' ninth manager since Abramovich took over in 2003.
A Chelsea statemen said: "The owner and the board believe that in Benitez we have a manager with significant experience at the highest level of football, who can come in and immediately help deliver our objectives.
"The two-time Uefa Manager of the Year comes with outstanding pedigree."
Benitez joined Liverpool from Valencia in 2004 and won the Champions League in 2005, as well as reaching the final in 2007, before leaving Anfield by mutual consent in 2010.
He has been out of work since he was sacked by Inter Milan in December 2010after just six months in charge despite winning two titles - the Club World Cup and Italian Super Cup.
The Spaniard is due to meet the players at the training ground in Cobham on Thursday, before his first match in charge at home to leaders Manchester City on Sunday.
Earlier, when asked if Chelsea had approached him, Benitez told Abu Dhabi-based website Sport 360: "I am looking for a club that can challenge for trophies and Chelsea is one of these clubs."
When he was asked about the prospect of managing on a short-term basis, he added: "I am just trying to go to a team that can win. So we will find ways to have a challenge like this."
Former Chelsea midfielder Nigel Spackman suggested Benitez's appointment would be unpopular.
He told BBC Radio 5 live: "You won't find many Chelsea fans happy with an appointment of an ex-Liverpool manager.
"Benitez has got a great CV and a good record, but the only way he will win the Stamford Bridge crowd over is getting the results. Now he had to focus on trying to win the Premier League.
"He is the interim manager but if he does a good job maybe he will get it for longer."
Blues supporters' groups had earlier reacted angrily to suggestions Benitez could be named Di Matteo's successor.
David Johnstone, spokesman for Chelsea fanzine cfcuk, told BBC Sport: "Rafa Benitez is not a Chelsea manager. Some people are born to play for or manage certain clubs and for us, Benitez isn't what we want.
"When he was Liverpool manager and Jose Mourinho was Chelsea boss there was a bit of 'beef' between them.
"He was very dismissive of Chelsea, very rude towards us and my impression of him was, whenever anything went wrong it was always somebody else's fault, not his."
But former Liverpool and Germany midfielder Dietmar Hamann, a Champions League winner under Benitez at Anfield, believes the Spaniard will improve Chelsea and target silverware.
"He is a very talented and outstanding manager," he told BBC Sport.
"He's a very meticulous worker and he puts a lot of emphasis on tactical exercises and you can see it - his handwriting is all over his teams."
The length of Benitez's contract appears to indicate Abramovich's determination to land Guardiola once the former Barcelona manager returns to the game.
Guardiola, 41, is midway through a 12-month sabbatical having left Barcelona at the end of last season having won 14 trophies in four years, including three titles and the Champions League twice.
Di Matteo won the Champions League and FA Cup as caretaker manager last season and was given a two-year deal in June.
But following the defeat to Juventus, which has left the Blues on the brink of a Champions League exit, he has left Stamford Bridge after just eight months in charge.
Benitez's coaching career
1960: Born Madrid, 4 April
1886: Joins Real Madrid's coaching staff
1995: Becomes coach of Valladolid but sacked after 23 games
1996: Osasuna tenure ends after nine games
1997: Wins promotion with Segunda Division Extremadura
2000: Gains promotion from Segunda Division with Tenerife
2001: Appointed Valencia boss, securing club's first league title in 31 years
2004: Wins league and Uefa Cup with Valencia
June 2004: Signs five-year deal with Liverpool
2005: Secures Champions League in his first season
June 2010: Becomes new manager at Inter Milan
December 2010: Leaves Inter weeks after winning Fifa Club World Cup
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