Mihajlovic, who has also managed the Serbian national team, was sacked by Milan last month, with less than a season in charge, after failing to lift their indifferent league form..
Mihajlovic replaces Giampiero Ventura, who has left Torino after five years in charge.
In a statement on the club's website (http://torinofc.it/), Mihajlovic thanked officials at Torino for the trust they had shown in allowing him to work at a club with such a "glorious and prestigious history".
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Mihajlovic has extensive coaching experience in Serie A, having previously managed Fiorentina, Bologna, and Sampdoria.
(Reporting by Silvia Recchimuzzi in Gdynia; Editing by Richard Balmforth)
