In 1964, Osborne joined the Nebraska Cornhusker coaching staff as an unpaid offensive assistant to head coach Bob Devaney; his only compensation was being able to dine at the athletic training table. After two disappointing 6–4 seasons in 1967 and 1968, Devaney named Osborne as offensive coordinator for the 1969 season. Osborne immediately overhauled the offense, switching to a balanced attack operated from the I formation. The revamped offense sparked the 1970 Cornhuskers to the national title. The Huskers defeated LSU, 17–12, in the 1971 Orange Bowl and finished first in the post-bowl AP Poll. Nebraska was 13–0 in 1971 and a consensus national champion, defeating the next three teams in the final AP Poll: Oklahoma, Colorado, and 1971 Alabama. Devaney announced he would step down as head coach at age 57 after the 1972 season to concentrate on his duties as athletic director, and named Osborne as his successor. Following a convincing win over Notre Dame in the 1973 Orange Bowl, Nebraska’s third straight Orange Bowl victory, Osborne, age 35, took over as head coach.

In his quarter-century as head coach, Osborne was a model of consistency. His teams never won fewer than nine games in a season, only finished worse than third in conference or division play once, finished in the top 15 of the final AP poll 24 years out of 25 (having finished 24th in 1990), and were ranked in every single weekly AP poll barring one week in 1977 and two in 1981. Osborne’s teams won outright national championships in 1994 and 1995, and a share of another in 1997. Osborne’s Huskers also won or shared 12 Big Eight Conference titles and one Big 12 Conference title. His 255–49–3 record gave him the best winning percentage (83.6%) among active NCAA Division I-A coaches at the time of his retirement. Osborne went on an NCAA record 60–3 run over his final five seasons, won 250 games faster than any coach in Division I-A history. Osborne finished his coaching career with a bowl record of 12–13.

Osborne’s teams were known for their powerful rushing attack and strong defense (also known as the Blackshirts—referring to the black jerseys that are worn in practice by the defensive starters and certain selected special teams players). Nebraska led the nation in rushing several times in the 1980s and 1990s, due to the efforts of men like Jarvis Redwine, Heisman Trophy winner Mike Rozier, Calvin Jones, Ahman Green and Lawrence Phillips. After struggling to defend Oklahoma’s wishbone option in the 1970s, Osborne switched from a balanced attack to a run-based option offense in 1980 in order to utilize the versatility of dual-threat quarterbacks, such as Jeff Quinn, Turner Gill, Tommie Frazier, and Scott Frost. Osborne earned his first title as head coach, defeating Miami in the 1995 Orange Bowl. The Huskers, who initially trailed, rallied to win 24–17. The next year, the Huskers roared through the regular season, stayed atop the rankings for all but one week, and crushed the Florida Gators, 62–24, in the 1996 Fiesta Bowl, earning Osborne his second national championship. The 1995 team was voted as the greatest college football team of all time in an ESPN poll. Osborne announced his retirement as head coach late in the 1997 season, selecting Frank Solich, his longtime running backs coach, to succeed him. In his final five seasons, Osborne’s record was a staggering 60–3 (.952). His final game as head coach came in the 1998 Orange Bowl with a 42–17 victory over Tennessee, also the final NCAA game for Tennessee quarterback Peyton Manning.

Osborne was inducted into the College Football Hall of Fame in 1999, and in 2000, he received the Jim Thorpe Lifetime Achievement Award. In 1999, ESPN honored Osborne as the coach of the decade for the 1990s. This honor is even more impressive considering the fact that he did not coach for 20% of the decade. In a 2007 online ESPN poll, Osborne was voted the “greatest college football coach of all time”.

In 1999, Nebraska renamed the playing surface at Memorial Stadium Tom Osborne Field in Osborne’s honor. The stadium had almost doubled in size during his three decades on the coaching staff, reflecting Nebraska’s increased national prominence in that time.