The announcement ends a five-week search that began with the firing of Rick Carlisle after four seasons.

O'Brien previously coached in Boston and Philadelphia, compiling a 182-158 record in five seasons. He has been out of coaching since he was fired by the 76ers after the 2005 season.

Pacers president Larry Bird said he had talked with O'Brien during the past 10 days about the job.

"It came down to we needed a guy with experience in here. A guy who I think I'm going to be on the same page with to do the things necessary to take us to the next level," Bird said. "I've got the right man for the right job."

Indiana finished out the playoffs with a 35-47 record this year. The team has been in disarray since the November 2004 brawl between Pacers players and Pistons fans — months after the Pacers had finished with the NBA's best record and reached the Eastern Conference finals.

Bird has said he is willing to trade anyone on the team, including All-Star forward Jermaine O'Neal.

The Pacers don't have a pick in the upcoming draft, though chief executive Donnie Walsh has said the team will maneuver to get one.

O'Brien had a 43-39 record in his single season at Philadelphia, a 10-win improvement from the year before, leading the team back to the playoffs. O'Brien, though, wasn't popular with his players, who often complained about their roles.