Dunga, who captained Brazil to the World Cup title in 1994, has replaced Carlos Alberto Parreira as head coach of Brazil, which exited in the quarterfinals of the 2006 World Cup.
Dunga, 42, who also represented Brazil at the 1990 and 1998 World Cups, has no previous coaching experience, which has drawn comparisons to Germany's selection of Juergen Klinsmann as head coach in 2004.
Vanderlei Luxemburgo had been the favorite to replace Parreira but his chances were hurt because of a falling out he had with Ronaldinho during his stint as Brazilian coach in 1998-2000.
Dunga was a hard-tackling midfielder but had a good touch, passed well and possessed a lethal long-range shot.
His real name Carlos Caetano Bledorn Verri. The nickname, Dunga, is Portuguese for Dopey, one of Snow White's seven dwarfs.
Before captaining Brazil to its first World Cup title in 24 years at the 1994 finals in the USA, Dunga was scape-goated for its second-round exit in the 1990 finals. The Brazilian press dubbed it the "Dunga Era," accusing the Selecao of trading in its flair for a hard-tackling European-style game.
At the 1998 World Cup, Dunga captained Brazil to a runner-up finish. Dunga, who played club ball in Brazil, Italy, Germany and Japan, won Copa America in 1999 with Brazil.
Brazil's next game is a friendly in Norway on Aug. 16.
Parreira, 63, is meeting this week with the South African soccer federation about its head coaching job. The 2010 World Cup host, which failed to qualify for the 2006 finals, has been without a coach since February and has gone through 13 coaches in the last 14 years.