"I'm very pleased to be a part of a great franchise in a beautiful city with such a proud history," Stotts said in a statement released by the Blazers. "I look forward to working hard with Neil and our players toward the ultimate goal of bringing another championship to Portland."
Stotts, 54, is 114-168 in four seasons as coach of the Atlanta Hawks and Milwaukee Bucks. He spent the past four season as an assistant with the Mavericks.
"Terry is one of the elite offensive minds in the NBA, has extensive experience with multiple organizations and was instrumental in the Dallas Mavericks winning the 2011 NBA Championship," Blazers GM Neil Olshey said in a statement. "He understands the vision for the future of the franchise, appreciates the process involved and will create an environment on the court that will produce championship habits."