Miles was the offensive coordinator for Oklahoma State when the team went 8-4 and played in the Alamo Bowl in 1997, the school's last winning season.
"I am completely and utterly thrilled to have Les Miles back in Stillwater," athletic director Terry Don Phillips said. "We needed a person of integrity, a person of character as well as an excellent football coach that's a player's coach. And Les Miles brings that to us."
Miles, the Dallas Cowboys tight ends coach the past three seasons, replaces his former boss, Bob Simmons. Simmons was forced to resign last month after six years with Oklahoma State.
Miles' voice broke as he introduced his family and acknowledged those with whom he had worked at Oklahoma State.
"This is all about you guys and I appreciate the opportunity to be named your head coach," he told the players. "It's a sacred trust and I will do everything I can to help you do the things that you want to do here."
Dallas Cowboys owner Jerry Jones said he was sorry to lose Miles.
"He's extremely well-qualified to be a college head coach, and I know he had a very serious (passion) for Oklahoma State."
Last week, Oklahoma State was ready to hire Boise State's Dirk Koetter. But Koetter pulled out at the last minute and took the coaching job at Arizona State.
After Koetter withdrew, Miles and former Oklahoma State quarterback Mike Gundy were granted second interviews last week. Gundy is only 33 and relatively inexperienced, but Phillips said he was a serious candidate.
Miles has worked for sch coaches as Bill McCartney at Colorado and Bo Schembechler at Michigan. Miles also played for Schembechler at Michigan from 1972-75.
His must be approved by the school's board of regents, which is to meet this week.
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