From dark horse to fiery steed, Spain were changed for ever by Euro 2008. Thanks to Fernando Torres's goal against Germany and Cesc Fàbregas's penalty against Italy, la selección finally won a major tournament – and a new identity. A new mentality. This Time, England's 1982 song, could have been written for them. Declaring themselves favourites is nothing new but this time, more than any other time, Spaniards actually believe it. "If we'd said four years ago that Spain would win the European Championships and go into the World Cup with a real chance of winning it, you'd have said we were mad," Torres admits. "But not now."

As one headline put it: "Spain come into this World Cup as genuine favourites." The "unlike every other World Cup" went without saying. After Spain defeated France in Paris in the spring, one columnist wrote: "Hands up any of you who did not go to bed last night with the feeling that no one can stop this team. Step forward those of you who don't think that, barring some major accident or a coincidence of strange events, we're coming back from South Africa with the Cup under our arm. Too optimistic? No, just realistic."

Realistic might be pushing it, but it is not just the Spanish saying so. The coach, Vicente del Bosque, has constantly fled the favourites tag, like it was some kind of plague-infected rat hell-bent on biting him. It is, he insists, a "terrible trap". But however hard he runs, however cleverly he hides, there is no avoiding it. "Everyone," notes Torres, "is talking about us. Whenever coaches or players are asked for their favourites, they mention Spain. We've earned that. In the past we talked about being favourites when maybe we weren't – this time we really are."

Much of that is due to sheer talent. This generation of players is, quite simply, better than those before. Raúl is often declared the finest Spanish footballer ever, certainly their best goalscorer. Yet David Villa is now only seven behind him. Having played 46 games fewer. If Torres is fit, Fàbregas doesn't get in the side and few complain. Mikel Arteta never gets in the squad and no one has even noticed. As Thierry Henry puts it: "They have Villa and Torres; they have Xabi Alonso and Cesc, Iniesta and Xavi, and Silva. It's incredible."

Euro 2008 underlined the depth of talent and also enhanced it, changing perceptions, strengthening the selección. Without it, attitudes coming into South Africa would surely be very different. The chances too.

No one here will forget Torres putting the ball beyond Jens Lehmann. That goal on 29 June 2008 ended a 44-year wait. Spain, along with England, were the ultimate underachievers. Now England stand alone, contemplating a four-decade drought. But, says Torres, the moment Spain won Euro 2008 – the moment that not only changed their history but their future too – happened a week earlier, when Fàbregas's penalty beat Gianluigi Buffon in a shoot-out. That was the turning point.

Spain had got through a quarter‑final. And against Italy too, the side they had not beaten in a competitive match for 88 years, the one they love to hate, the country with all the qualities – said through gritted teeth – that Spain lack: luck, competitiveness, effectiveness. They had done it on penalties, after a goalless draw and on 22 June, the date they had lost on penalties three times running. They had overcome a mental barrier: before Euro2008, the band Pignoise, led by the former Real Madrid player Álvaro Benito, wrote a tournament song. It was called 'Let's Get Beyond the Quarters!' At last Spain had done.

David Villa says, "owed us." Now it no longer weighs them down. Had Spain lost to Italy their early-tournament brilliance would have been lost in a familiar fog of depression. Instead, everything they do was reinforced, vindicated. Primarily, the adoption of a ball-playing game. For years Spain sought an identity; now it is unshakable, embedded, resistant. Natural. "Spain play with incredible ease," Arsène Wenger says. The ball belongs to them. "Watching them on TV is lovely," Henry says, "but playing against them is infuriating: you never get possession."

The clarity and stability, the contentedness, is startling. Debates are few – the outcry for Víctor Valdés to be included as third-choice keeper when most countries struggle to find a first spoke volumes about the strength of the squad and was at least in part provoked by club sectarianism and boredom.

But for Euro 2008, things might have been different. Style is fine but there's no security blanket like success. Each victory reinforced the model, a virtuous circle; very occasional poor performances are not enough – at least not yet – to leave people questioning it. After Spain's disappointing 1-0 win over South Korea on Thursday, a result that once would have had them panicking, the county's best-selling newspaper simply stated: "Now's not the time to sound the alarms but to keep the faith in a team that has earned it."

Earn is not the half of it. The style works. The stats are uncontestable. At the end of the previous friendly, against Saudi Arabia, the defender Carlos Marchena broke the world record, surpassing Garrincha by going 50 internationals unbeaten. Spain won 10 out of 10 in World Cup qualifying – the first team ever to do so – and have lost only one of their last 47 matches. They have won 36 of their last 37. Including beating Italy, Argentina, France and England. Twice. During the France match, the St Denis fans started olé-ing the opposition's every touch.

"Spain have confirmed that they're one of the great favourites for the World Cup," the France coach, Raymond Domenech, said afterwards. "They have exceptional talent, sacrificed for the collective good. They play without haste and yet they do so with intensity and intent. Their circulation of the ball is spectacular and the final pass from midfield is like a penalty for anyone else."

Asked how he would handle them in South Africa, Domenech shrugged. "Luckily, we won't play Spain until the final so I don't need to think of that just yet," he said, adding quickly: "If we get there." If we do. He, like so many others, didn't doubt that Spain would.