Daei who is the leading international scorer in football history, was given the helm of Team Melli (national team) on Sunday in a shock move after he had been mooted last month as an outside choice for the post.
His main task is to lead the national squad to the South Africa 2010 World Cup. Daei will now be in charge of preparing the team for Iran's next qualifier which is against Kuwait on March 26 in Kuwait City.
The national side made a disastrous start to their World Cup campaign last month by only drawing with minnows Syria in a performance that betrayed the effects of the lack of a coach.
"... and Deai became the coach," a satirical headline pointing to several months of waiting for the announcement of the coach.
Iran nearly signed up the Spaniard Javier Clemente, but a row over his persistence to remain home and only come to Iran near the beginning of a match dissolved the agreement.
"Mr World Goal, has become Iran's Team Melli coach," the Navad newspaper referred to Daei's 109 international goals record in 148 appearances, outstripping greats like Pele and Ferenc Puskas, although admittedly against less demanding opponents.
In his first reaction to the appointment, Daei was quoted in the Iranian state television as saying that,"With Honor I accept the post. With honour I will serve the Team Melli."
"This (coaching) bench was his right," the Goal daily headlined an overly excited picture of Daei.
"Become a legend again," headlined Iran-e Varzeshi newspaper over Daei's laughing photo clad in a designer suit.
Daei, whose career includes spells at Bayern Munich and Hertha Berlin, only retired fully from playing last year and until now has coached Tehran club side Saipa, who he led to the Iranian league title last year.