The Raiders officially announced Allen's hiring on Friday, three days after reports initially emerged that he was new general manager Reggie McKenzie's choice to lead the franchise. Allen will be officially introduced at a news conference Monday but has likely already started the process of putting together his first staff as a head coach at any level.
Davis made almost all the key decisions for the Raiders in his nearly half-century with the franchise before he died Oct. 8. He made most of the personnel moves, hired the coaches and hand-picked many of the assistants in a process that contributed to three Super Bowl titles and plenty of playoff trips when it worked, as well as a current nine-year playoff drought.
There is now a new structure in place in 2012 with Davis' son, Mark, serving as managing general partner. Mark Davis hired McKenzie as his general manager earlier this month and gave him the power to make all football decisions.
McKenzie immediately fired Hue Jackson, who went 8-8 in his only season as head coach, and began a search for a replacement that led to the decision to hire Allen.
Allen got a longer deal than the two-year contracts with options that Raiders coaches had traditionally be given by Davis in the past. Allen's contract is for four years, a person familiar with the deal said on condition of anonymity because the team did not announce the length.
Allen will also be allowed to pick his coaching staff in a change from how things operated under Davis. He often picked many of the assistants, some whom stayed on from regime to regime, in a process that was criticized by the head coaches.
McKenzie made clear at his introductory news conference that that practice would change.
"What I'm going to do is empower the head coach to hire his staff, the best possible staff that he can hire," McKenzie said. "We're not going to tie the guy's hands and tell him he has to hire this guy or this guy. It wouldn't be fair to the new head coach. The head coach will have the right to hire any coach that he wants."
Offensive co-ordinator Al Saunders is the only assistant under contract for next season and it is uncertain whether he will return for a second season in Oakland. Receivers coach Sanjay Lal has joined the New York Jets and defensive line coach Mike Waufle has reportedly been hired by St. Louis.
The status of the other assistants is up in the air as they have been told they are free to look for other jobs but could be asked to stay by the new coach.
Allen, 39, will be the first new Raiders coach to come from the defensive side of the ball since Davis hired linebackers coach John Madden in 1969.
In his first season as co-ordinator in Denver, Allen helped the Broncos improve from allowing a league-worst 29.4 points and 390.8 yards per game to ranking 20th in yards (357.8) and 24th in points (24.4) this season on the way to an AFC West title.
Before serving as Denver's defensive co-ordinator last season, Allen spent five years as a defensive assistant in New Orleans and also coached for Atlanta.
Denver head coach John Fox said he was happy for Allen and was not surprised he got a promotion after just one year as a co-ordinator.
"He's a sharp guy who knows football, has a way of relating to his players and carries himself very well," Fox said in a statement. "Dennis is a strong motivator and teacher with an aggressive style of coaching. He will approach the job with tremendous energy and passion to get the most out of his team. His thorough understanding of defence, from the back to the front, and his ability to teach fundamentally and assignment-wise really helped us get better. He's been around a lot of good people during his NFL career and has a very bright future ahead of him."
The Raiders are coming off one of their worst defensive seasons ever. Oakland had franchise worsts in touchdown passes allowed (31), yards per carry (5.1), yards passing (4,262) and total yards (6,201), while giving up the third-most points (433) in team history.
The Raiders joined this year's Tampa Bay team as one of the four teams to allow at least 30 TD passes and 5.0 yards per carry in a season, a distinction last reached by the 1952 Dallas Texans. The Raiders also became the sixth team since the 1970 merger to allow at least 2,000 yards rushing and 4,000 yards passing in a season.
The Raiders also set an NFL record last season with 163 penalties for 1,358 yards.