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McKay, who jumped ship from Colorado State less than two years after calling it his dream job, replaces Eddie Payne, who was fired March 12 after five straight losing seasons.

McKay is just the sixth Oregon State coach since 1928, and the first black basketball coach.

McKay was an assistant coach at Washington from 1993-95, the last two seasons under Bob Bender, and the conventional wisdom was that the only Pac-10 job McKay would take would be with the Huskies.

"I feel very comfortable with the commitment that the McKay family is making to Oregon State," athletic director Mitch Barnhart said.

McKay has a five-year contract worth $265,000 a year at Oregon State, including a $140,000 base salary, but there is a buyout clause should he choose to leave the Beavers. Oregon State bought out the final four years of McKay's contract at Colorado State for just over $100,000. The only school that would have been exempted from the clause was Washington.

Although he has a record of just 61-52 in four seasons as a head coach, McKay became a valued commodity by rebuilding Portland State, which dropped basketball in 1981. The school went 15-12 in McKay's second season, and he went to Colorado State to replace Stew Morrill in 1998.

The Rams went 19-11 last season and made the National Invitation Tournament. This season the team went 18-12, including an 83-78 win over Oregon State in December. The Rams failed to reach the postseason after losing to Wyoming in the first round of the Mountain West Conference tournament.

Barnhart interviewed five other candidates, but McKay was his first choice. The only issue was whether Oregon State, which has a $5.5 million budget deficit for its athletic department, could afford him. McKay's annual pay at Colorado State was $250,000, about $50,000 more than Payne earned.

McKay thought about the job for two days before making his decision.

"If you think it was an easy decision you're wrong, because he loved it here," assistant coach Dale Layer said in Fort Collins, Colo. "We sat with him every day, and it tore him up."

He will try to bring back a program that was ranked No. 1 in 1981 and was a perennial power during the 1980s. The Beavers' last winning season was 1989-90, Gary Payton's senior year.