O'Brien left the Nittany Lions less than two years after replacing Joe Paterno, returning to the NFL with the Houston Texans to coach the team with the league's worst record this season.
"I believe that Bill O'Brien came here with the intent to be here for a long haul," Penn State athletic director Dave Joyner said Thursday.
He lasted only two seasons. Despite a lack of scholarships, a bowl ban, an overall sense of doom and player defections from the late Paterno's roster, O'Brien led the Nittany Lions to two winning seasons while restoring some tempered enthusiasm in Happy Valley.
Penn State picked defensive line coach Larry Johnson as interim head coach while the search for a replacement goes on.
A former offensive coordinator for the New England Patriots, O'Brien took on perhaps college football's toughest job in January 2012, joining a school rattled by the Jerry Sandusky child sex abuse scandal.
Joyner formed a search committee and said it won't take long to find a new coach.
"I think it's a lot more attractive at this point, although we had tremendous interest even in spite of everything two years ago," Joyner said. "From a scholarship standpoint, we're going to be very competitive right out of the gate. Watching what's happened here the last two years, if I was a head coach candidate, would make me very excited."
While some scholarships have been restored, Penn State lacks the full allotment that other Big Ten schools - including new members Rutgers and Maryland - have at their disposal.
The Nittany Lions could use one on a wide receiver. Third-team All-American Allen Robinson decided Thursday to forgo his final year of eligibility and will enter the NFL draft.
Robinson set Penn State season records in receptions (97) and yards receiving (1,432) for the second consecutive year.
He wrote on Twitter: "It was a honor to wear a penn state uniform for 3 years. I will miss my teammates and coaches, blessed for the opportunity and experience."
Robinson is the second big loss for the Nittany Lions this week after O'Brien's defection.
O'Brien will become the third coach in Texans history, following Dom Capers, who led the team from its expansion season in 2002, and Gary Kubiak. Houston made the official announcement Thursday.
Kubiak took over when Capers was fired after a 2-14 season in 2005. Kubiak went 61-64 and led the Texans to their first two playoff appearances and two AFC South titles before being fired in early December.
Houston was expected to contend for the Super Bowl this season but instead lost nine games by a touchdown or less to end with the NFL's worst record at 2-14.
Joyner said O'Brien's contract buyout was in the $6.5-6.7 million range. Penn State worked with O'Brien until the end to keep him.
Penn State's field of candidates is likely to include many from college and the NFL. Greg Schiano has Penn State ties and may want to return to college after two forgettable seasons with the NFL's Tampa Bay Buccaneers. While at Rutgers, Schiano was viewed as an Eastern recruiting expert who built the Scarlet Knights into a consistent bowl team by landing players from New Jersey to Miami.
Schiano would likely be received well in State College, but he is not O'Brien.
O'Brien, who helped lead the Patriots to the Super Bowl in 2011-12, arrived in Happy Valley with sterling credentials - apprenticeships coaching at Brown, Georgia Tech, Maryland and Duke, followed by five years as an NFL assistant on Bill Belichick's staff. He won games and won over players, and he did so with a stern look on his face.
O'Brien did it all in Paterno's shadow. Over the course of his 61 years at Penn State, Paterno became not just the face, but the cantankerous soul and benefactor of a school that was transformed from a "cow college" into a top-shelf public university.
Joyner said O'Brien never seemed affected by the Paterno loyalists who were slow to warm to an outsider running the program.
"Bill handled that very well, with grace and style," he said. "I really believe that he loved it here. From the get go, he looked at himself as a long-termer. But I think a tremendous opportunity came up for him."