The former Blues' defender switches places with Trevor Francis, who was appointed to Bruce's old post at Crystal Palace after being sacked by Birmingham .

Bruce's appointment follows a long and acrimonious wrangle over the terms of his release from Palace.

Bruce had tried to resign as Palace boss in October in order to take over at St Andrews.

But he was suspended by the London club, who were unhappy at his decision to leave to go to Birmingham.

Palace won a temporary injunction preventing Bruce from leaving the club without serving a nine-month notice period.

The bitter dispute went to London's High Court where a judge ruled that Bruce must stay at Palace until 14 January when the case was due to return to court.

But a week later Palace appointed Trevor Francis as their manager, who was sacked by Birmingham to make room for Bruce.

Bruce will bring in his coaching staff of Mark Bowen and John Benson, also on five-year contracts.

The trio worked together at Crystal Palace and Wigan.

They will step into the places vacated by departing caretaking management duo of Mick Mills and Jim Barron.

Birmingham City's joint-owner David Sullivan said: "We are delighted to have installed Steve Bruce as our manager.

"I have been very low while our on-going search for a new manager has progressed but it has now been well worth the wait.

"I am excited at the prospect of the remainder of what I hope will be a very successful season."