Assistant coach Sahin has stepped up to become Dortmund’s new boss on a three-year deal.
Sahin won the Bundesliga title and the German Cup in 274 appearances as a midfielder for the club.
The Germany-born former Turkey international stepped into coaching with Antalyaspor after retiring as a player, before returning to Dortmund as an assistant to Terzic this year.
Sahin called his appointment a “great honour”, while Dortmund managing director Lars Ricken commended the 35-year-old’s qualities and stressed they meant he was ready for the high-pressure job.
“We are very pleased to be able to hand over the responsibility of head coach to Nuri as a representative of the younger generation,” said Ricken, who played for the club alongside Sahin.
“He has been committed to preparing for a coaching career in recent years and will take on his new task with a lot of dedication and develop our team. As former team-mates, we will work together in a trusting and ambitious manner.
“Nuri knows the club, its staff and its DNA, both as a player and as an assistant coach. We are convinced that Nuri is the right coach for us.”