A statement on the English Premiership club's official website said that the 51-year-old has signed a three-year contract which will commence from 1 July 2004.
'Proud and happy'
"I feel proud and happy with my decision," the Mozambique-born Portuguese national said. "It is a commitment to Manchester United where football achievements and ambitions fulfil my personal professional goals. I would like to express my respect and gratitude to the Board and Sir Alex Ferguson for the trust and confidence they have given me."
Sir Alex delight
Sir Alex himself added: "I am delighted to have Carlos back, I was sad to see him leave last year but understood his reasons for doing so. Now he has experienced new challenges and he can bring those new experiences with him."
Queiroz helped United win the 2002/03 Premiership before accepting an offer to coach Madrid. However he left the Spanish giants after just one season in which they finished fourth in the league and were knocked out in the quarter-finals of the UEFA Champions League. United enter next year's Champions League in the third qualifying round.
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