The 49-year-old former Sevilla coach put pen to paper on a two-and-a-half year contract after witnessing their first defeat of the season 24 hours earlier when Atromitos came away from the Georgios Karaiskakis stadium with a 3-2 win.
Olympiacos have assembled a plentiful haul of domestic trophies down the years - including 39 league titles - but despite regularly competing in the Champions League since its inception in 1992, European success has eluded them.
They have managed one appearance in the quarter-finals in 1999 and been beaten in the last 16 in 2008 and 2010.
Michel, who replaces Leonardo Jardim after the Portuguese surprisingly left last month, feels he can help the club make the step up to becoming a more prominent European force.
"I have made the commitment to make Olympiacos a more international team as befits a club which has enjoyed so many successes (domestically)," Michel, sacked by Sevilla on January 14 following a poor run, told a news conference.
"I would like to thank the president for giving me the opportunity to work at this wonderful club. I work with passion and with my heart and I have come here only to succeed. Olympiacos is a demanding club and what interests me as well as the president is to make this club even better."
Despite the defeat to Atromitos, Michel has inherited a team which is already seemingly running away with yet another Super League title with the Red and Whites leading second-placed Asteras Tripolis by 13 points after 20 matches.
Olympiacos are also through to the last 32 of the Europa League where they will meet Spanish club Levante.
If successful they could also face Spanish opponents in the last 16 in the form of Europa League holders Atletico Madrid.
Antonis Nikopolidis, who had taken temporary charge after Jardim's sudden departure, will remain on the coaching staff.
It is the first time that Michel, who made over 400 appearances for Real Madrid in a glittering playing career, has coached outside Spain following spells with Rayo Vallecano, Real Madrid B and Getafe before his 11-month stint at Sevilla.
- Sports & Recreation
- Leonardo Jardim