Arnold stepped down last Friday after six years in charge, following a surprise 1-0 home defeat to Bahrain and a draw against Indonesia in recent World Cup qualifiers.
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These results have left Australia in fifth place in the Asian standings, with only the top two teams automatically qualifying for the 2026 World Cup.
Popovic, 51, who earned 58 caps for the Socceroos, has signed a two-year contract.
“It’s a role that comes with great responsibility, and I’m deeply grateful for the opportunity,” Popovic said.
“This is undoubtedly a very proud moment for myself and my family. To be entrusted with guiding our national team is a privilege I do not take lightly.”
Popovic played for Crystal Palace for five years before leaving in 2006. He represented Australia in the 2006 World Cup and has since managed teams in Australia, Turkey, and Greece.
Australia’s next World Cup qualifier is against China on 10 October in Adelaide.
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