Sevilla have announced that Michel will become Marcelino Garcia Toral's replacement following his dismissal on Monday.
The 48-year-old, whose full name is Jose Miguel Gonzalez, has joined the club until the end of the season.
Michel will automatically receive an extension to the contract should he guide the 11th-placed side to UEFA Champions League qualification.
The former Real Madrid midfielder made 404 appearances for the Bernabeu side over his 14-year stay at the club whilst netting 97 goals.
Michel managed the Real B side in 2006 before he went into first-team management three years later taking over the reins at Getafe.
The former Spain international took the managerial vacancy at Sevilla when the board made the decision to part company with Marcelino after failing to register a single victory in the last seven outings.
Marcelino only joined the club in 2011 but with only two points from the last seven games in La Liga, the club decided it was time for a change in leadership.
Defeat at home to Villarreal on Sunday was the final straw for Marcelino and Michel will hope he can turn the tables with Sevilla on Monday when he takes charge for the first time at Real Sociedad.