Left-back Dawson, 34, was persuaded by Scunthorpe boss Brian Laws to return to the club after a decade at Hull. He considered taking up a coaching role with the Tigers, but opted to come back to the Iron.
Dawson told Scunthorpe's official website: "I know the manager really well. It is a good opportunity
"It is part of a learning curve for me and I want to progress as a coach.
"There are a lot of young lads and they have a very good attitude and they always want to learn and that is all I have ever done as a player."