Ferrara: I am delighted but surprised
He takes the reigns from Pierluigi Casiraghi, who stepped down after Italy failed to qualify for the 2011 UEFA European Championship due to a loss to Belarus in their play-off earlier this month.
Ferrara, who was unveiled today, said: "I am delighted but surprised. I didn't expect the call from the Italian Federation.
"I don't believe this is a step back in my career but a great opportunity to grow as a coach. Even if my spell at Juventus ended badly, I thank them because as a club they gave me so much."
Ferrara endured a miserable spell as Juve coach, after taking over at the end of the 2008/09 campaign with no previous experience of first-team management. He was sacked after his side were knocked out of the Coppa Italia while also lying outside the top four in Serie A.
Former Italy coach Marcello Lippi believes Ferrara and Peruzzi will enjoy success in charge of Gli Azzurrini. "In my opinion, this is the right choice," the 2006 FIFA World Cup Germany™-winning coach said.
"Ferrara and Peruzzi are two valuable elements, both in technical and moral terms. They will certainly help their team and the Italy football movement."