City proved Hodgson’s first managerial job in English football when he was appointed in 1982 having spent two years as Bob Houghton’s assistant.
Hodgson lasted just four months amid considerable financial upheaval at Ashton Gate, where the club nearly went out of business, and has previously said his time there was “nothing short of a disaster”.
He returns to the West Country with vast experience having managed Inter Milan, Liverpool, Fulham, Blackburn Rovers, West Bromwich Albion and the national teams of Finland, England, Switzerland and the United Arab Emirates.
He guided Fulham to the Europa League final in 2010 and went on to succeed Champions League-winning boss Rafael Benitez at Liverpool that summer, but his time at Anfield proved unsuccessful and he was sacked the following January.
He went on to take charge of West Brom before taking over as England boss from Fabio Capello in May 2012.
He led England to the quarter-finals of Euro 2012, before going out of the 2014 World Cup in the group stages – the first time England had not made the knockout rounds since 1958.
He kept his job and took England to Euro 2016, but after a humiliating loss to Iceland in the last 16 resigned.
Hodgson went on to have two spells at Palace, interspersed by a short stint at Watford, before stepping down just over two years ago.
His first game in charge will be the Championship trip to Charlton on Good Friday.
“I have had great conversations with the board and I am really excited by the opportunity to help until the end of the season,” Hodgson told the club website
“We will get straight to work and look for a positive performance on Good Friday.”