It following much speculation about his future, with the Lilywhites agreeing a compensation package with the Rams before giving Davies permission to speak to them.
Davies had led North End to the play-offs the previous month but they had lost to Leeds 3-1 on aggregate in the semi-finals.
In the weeks that followed, Davies was interviewed for the Charlton Athletic job before Derby came in and asked to speak to the Scotsman.
They were initially refused permission and there was a tense seven-day stand-off before PNE finally accepted Derby's offer.
On the day of his appointment, Davies arrived at Derby's Moor Farm training ground by helicopter.
In the press conference which followed that day, Davies said: "It was time to move on [from Preston] to a different challenge... and I don't think there's a bigger challenge in football at the moment than Derby County with the potential it has."
Former Motherwell boss Davies had arrived at Deepdale in the summer of 2002 as assistant to Craig Brown.
Five games into the 2004/05 season, Davies stepped-up to take the manager's job when Brown left the club.
That campaign he led North End to within 90 minutes of the Premier League.
They finished fifth in the table and landed a play-off place, beating Derby 2-0 at Deepdale and drawing 0-0 at Pride Park in the semi-finals.
That landed them a clash with West Ham United in the final at the Millennium Stadium, the Hammers winning 1-0 in the Cardiff showpiece.
Although it took PNE a while to shake off that play-off hangover, Davies got them together again and a superb run of results carried them to the play-offs again.
But they came unstuck against Leeds, despite a 1-1 draw at Elland Road in the first leg.
A feisty return leg saw them beaten 2-0 on a night when a power cut in the Deepdale area plunged the ground into gloom for 20 minutes - meaning a delayed start to the second half.
Davies' first season in charge at Derby saw him guide them to the Premier League via the play-offs.
He left them by mutual consent in November 2007 with the Rams at the foot of the table.
Davies later had two spells in charge of Nottingham Forest but has not returned to management since leaving the City Ground for a second time in March 2014.