"I am genuinely excited about the opportunities ahead for Microsoft to make an enormous impact on the online industry," Lu said. "Microsoft has built a great foundation for its search and advertising technologies and put an amazing team of researchers and engineers in place to drive the next wave of innovation in online services."

Beginning Jan. 5, Lu will oversee several groups, including Microsoft's advertiser and publisher solutions business and the online audience, research and finance groups, according to the company. Lu will work with three top executives, including Scott Howe, Yusuf Mehdi, and Satya Nadella.

"I'm looking forward to working with them to help transform the way people and businesses use the Internet to find and share information," Lu said.

Gaining Strength

Brian McAndrews, former chief executive of aQuantive, an ad company Microsoft bought earlier this year for $6 million, is slated to leave the company after a few months of consulting with Lu and Microsoft CEO Steve Ballmer.

"I am tremendously excited to welcome Qi to Microsoft," Ballmer said. "Dr. Lu's deep technical expertise, leadership capabilities, and hard-working mentality are well known in the technology industry, and Microsoft will benefit from his addition to our executive management team."

The move comes after weeks of speculation that Microsoft would put in another bid for Yahoo's search business. Microsoft withdrew its $47.5 billion buyout offer in May after Yahoo's board and CEO Jerry Yang rejected the bid, saying it was too low.

Late last month Ballmer said Microsoft no longer was interested in buying all or parts of Yahoo, but added that it was still open to collaboration in Internet search.

And that is why Lu will fill a spot in Redmond left empty by Kevin Johnson, the executive who played a prominent role in Microsoft's attempt to acquire Yahoo.

Adding Lu to its team along with Sean Suchter, another former Yahoo engineer, is expected to give Microsoft the strength it needs to go head-to-head against Internet search giant Google.

Moving Forward

Lu left Yahoo earlier this year after a decade with the company. The engineer, described by some as a rock-star technologist with a slew of patents under his belt, was responsible for the technology in Yahoo's search and marketplace unit, which includes Yahoo's search, e-commerce and local listings of businesses and products.

While at Yahoo, Lu was also responsible for building Yahoo's search platform, including My Web 2.0, Yahoo Answers, and the acquisition and integration of Flikr and Del.icio.us.

Before that, Lu was a staff member at IBM Almaden Research Center. He also worked at Carnegie Mellon University as a research associate and was a faculty member at Fudan University in China.