Terim indicated he would leave the post after Euro 2008, admitting that Turkey's 3-2 loss to Germany in the semi-finals was likely to herald his return to club football.

But the Turkish football federation (TFF) were reluctant to see the 54-year-old go, and last Friday revealed that Terim had been persuaded to extend his stay beyond the 2010 World Cup.

"Terim is in his post and will be the head of our team in the 2010 World Cup," read a statement on the TFF's website at the time.

Terim, who has previously coached AC Milan, Fiorentina and Galatasaray. finalised a deal with the TFF on Tuesday that will see him stay on in the role until 2012.

Turkey under Terim were one of the star attractions at Euro 2008, reaching the last four by dint of dramatic last-gasp wins over Switzerland, Czech Republic and Croatia, before their injury- and suspension-hit side went down fighting against the Germans.

Terim will now hope to build on the good work of the past few weeks when the European zone World Cup qualifiers get under way in September.

Turkey have been drawn in Group Five alongside Estonia, Armenia, Bosnia-Herzegovina, Belgium and newly crowned European champions Spain.