Caparros takes the helm with four league games remaining, as Italian coach Vincenzo Montella was fired following a nine-game winless streak, reports Efe.
"It's a great satisfaction to be here in my home. I'm very happy because Sevilla has remembered me. I wanted to come back. I always said: when the club needed me I'd be there," Caparros said at a press conference.
Sevilla sits in ninth place in the La Liga table with 48 points, having failed to win a match since March 13.
Caparros vowed to do his best alongside the "fantastic squad with players of different levels" and to live up to the club's expectations.
Caparros, 62, first began coaching Sevilla in 2000 and left after a five-year spell to join fellow Spanish club Deportivo La Coruna.
His last managerial job was at the Qatari club Al Ahli, and he has been a free agent since December 2017.
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