The former Tottenham midfielder, who was already on the coaching staff at White Hart Lane, has taken on the interim role after Spurs sacked Andre Villas-Boas on Monday.
Fabio Capello, Glenn Hoddle and Southampton boss Mauricio Pochettino have emerged as early contenders for the position in the longer term but Sherwood could find his tenure extended, depending on results.
A Tottenham statement read: "The club can announce that Tim Sherwood, Chris Ramsey and Les Ferdinand will take charge of the first team whilst the club progresses discussions. Steffen Freund and Tony Parks continue as part of the coaching staff.
"Jose Mario Rocha, Luis Martins and Daniel Sousa leave the coaching staff and we wish them well for the future."
Villas-Boas' predecessor Harry Redknapp is confident that Sherwood has the necessary credentials to become the leading man on a full-time basis.
"Tim should get the job permanently and work alongside Les Ferdinand," Redknapp told the Sun. "Together they are old-school Spurs and would do a tremendous job.
"I brought them both back to the club because they understand the place. They are great coaches and don't forget, Tim was captain at Blackburn when they won the league in 1995."
The case for Capello, who is preparing Russia for the World Cup finals, has been strengthened by the fact that Franco Baldini, his former assistant at England, is Tottenham's technical director.
Other names linked with the post include former Tottenham striker Jurgen Klinsmann, currently coach of the USA, and a possible return for Hoddle.
Hoddle, who now works as a Sky Sports pundit, was in charge at White Hart Lane between 2001 and 2003 but has not been in club management since leaving Wolves in 2006.
He has won the backing of another Tottenham favourite, Gary Lineker, who tweeted: "Would love to see Glenn Hoddle given another chance at this level. Has a brilliant football mind."
Guus Hiddink's agent has ruled the Dutchman out of the running as he is taking over as Holland coach after the World Cup.
Swansea boss Michael Laudrup's representative has also insisted his client is committed to staying at his club until the end of the season.
Klinsmann signed a new four-year contract with the USA last week, but USA football president Sunil Gulati insists that the deal was not just to fend off interest from the likes of Tottenham.
"We've obviously read some of those things," said Gulati.
"On a specific level, none of those things were critical to us. The desire to make sure we had a long-term commitment from Jurgen, and he had one from us, was part of it, and market dynamic does dictate some of that.
"So we're not oblivious to the fact that Jurgen over the last two years has had an extraordinary run with the national team and that would bring a lot of interest from the outside.
"Sure, some of that matters, but not specifically the Switzerland or Tottenham issues, but generally a coach that has done very well, that has an international reputation, who speaks multiple languages would be sought after.
"So the desire to have a commitment from him, contractually, for a long period of time, that matters, of course."