Lu previously was Yahoo's executive vice president of engineering for the search and advertising technology group where he was responsible for developing Yahoo's Web search and monetization platforms.

Lu spent 10 years at Yahoo before leaving in August as part of a weeklong of eight executives from the struggling search company. He will officially join Microsoft on Jan. 5 and report directly to CEO Steve Ballmer.

In a statement, 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."

After failed bids to buy Yahoo earlier this year, Microsoft is now eyeing some of the company's top talent even as rumors circulate that the two may again be talking about a deal for . Microsoft made a $44.6 million offer in February to buy Yahoo, but then-company CEO Jerry Yang . Microsoft followed with a bid for Yahoo's search business but that deal also . 

Ultimately, the dealings with Microsoft and a failed marriage with crushed Yahoo's stock price and led to the departure of Yang.