Dunga has been appointed as the new coach of the Brazilian national team.
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The 50-year-old had already had a four-year stint in charge of Brazil that ended after the nation's elimination at the quarterfinal stage of the 2010 World Cup.
"I am immensely happy to be back," he said at a news conference in Rio de Janeiro on Tuesday.
He fills the vacancy left by Luiz Felipe Scolari, who had led the nation to World Cup glory in 2002 but was unable to repeat that feat at this summer's tournament on home soil and resigned last week.
The Selecao will now seek to recover from their 7-1 humiliation against Germany in their World Cup semifinal, and Dunga feels he is ready for the task.
"We are no longer the best," he said. "This is a project we all need to be aware of. Everybody had a concept of football and the World Cup. We can no longer pretend to be the big guys or that we are the best.
"Before the World Cup happens we sell to the public the idea we're going to win, but we don't know if we'll win. We need to be more modest. It's important to compromise because our opponents always want to beat us because we're Brazil.
"The Brazilian shirt is very respected, but everyone wants to beat us. We have to be prepared for that. We can't think that we'll pull on the Brazilian shirt and win the World Cup before it's even started.
"Nothing happens before the game starts. The most important thing is what happens during the 90 minutes on the pitch because that's when you win or lose."
Dunga's first spell in charge of Brazil brought 42 wins, 12 draws and six defeats.
"This is not my first time with the team," he said. "I was asked to rescue the value of the Selecao and get results.
"This is my second journey, with the request that I prepare the team for the 2018 World Cup. We are going to finish our preparation for the Copa America [in Chile in 2015], and then we will see where our selections are so that we can improve."
Dunga, who captained Brazil when they won the World Cup in 1994, had no experience as a coach when he replaced Carlos Alberto Parreira in 2006, but he led his country to success at the 2007 Copa America and 2009 Confederations Cup during his four years in charge.
Since that time, he has also gained experience of management at the club level with Internacional, although he was dismissed in October 2013 after less than a year at the helm.
There has been opposition to his appointment, but he said: "I have to improve my relationship with the press. It's my fault. We are here to start a job in the best possible manner. We are ready to receive criticism and suggestions, providing it is for the sake of the Brazil team."
Information from the Press Association was used in this report.