The Premier League could do with a new plot or at least the revival of an old favourite. Another contest between a Manchester United team in transition and a Chelsea side past their prime would be even less compelling than it was last time. There could never be a better moment for a Liverpool revival and with Kenny Dalglish back in charge at Anfield this may be about to happen.

André Villas-Boas, Chelsea's latest man for two seasons, will doubtless capture the immediate attention as a manager who may mount the sort of challenge to Sir Alex Ferguson and United that José Mourinho achieved during his time at Stamford Bridge. But it is the idea of Dalglish and Ferguson renewing their old rivalry which offers more intriguing possibilities.

Dalglish has turned 60 and Ferguson is approaching 70 yet it is hard to believe that the sparks and thunderclaps which have accompanied this Glaswegian relationship over the years will ever mellow with advancing age. In fact a serious threat from Liverpool this season and the possibility of them quickly equalling Manchester United's newly achieved record of 19 league titles would probably make Fergie feel several years younger.

While Liverpool, who have not won a championship since 1990, will have to put on seven-league boots if they are to put themselves on a par with United over the course of a single season, the return of Dalglish as manager in January, followed by his signing of a three-year contract in May, has already reawakened a revivalist fervour not experienced at Anfield since Bill Shankly arrived from Huddersfield in 1959 to begin the task of restoring the team to the First Division.

Dalglish came to represent what Liverpool in their great days were all about, first as a player under Bob Paisley and later as manager in his own right. Under Shankly, Paisley, Joe Fagan briefly and Dalglish, Liverpool's football became the culmination of the team ethic. Accurate passing and imaginative, selfless movement at the heart of their game. When the young Emlyn Hughes arrived from Blackpool in 1967 he was not allowed to train with the first team until he stopped giving the ball away.

John Smith, Liverpool's chairman when the team were accumulating championships, cups and European honours on a regular basis, once declared that Dalglish was "the best player this club has signed this century", which was probably not an overstatement. While Liverpool broke the British transfer record when they paid Celtic £440,000 for Dalglish in August 1977 the sum still seemed to undervalue the 26-year-old replacement for Kevin Keegan, who had left Anfield for Hamburg, and may have hastened the departure of a disillusioned Jock Stein from Parkhead.

Dalglish's extraordinary qualities, not only as a creator and scorer of goals but with his ability to control the pulse of a performance, were fundamental to the team winning five league titles, three European Cups and four League Cups. In his six years as player-manager and manager he added three championships and two FA Cups.

The team of 1987-88 represented the apex of Dalglish's first spell in charge at Anfield. Enriched by the perfectly blended talents of Peter Beardsley, John Barnes, Ray Houghton, John Aldridge, Steve McMahon, Ronnie Whelan and Alan Hansen, Liverpool swept to their 17th title with football of a pace and quality which left most of their opponents gasping for air. Among the Anfield crowd watching Liverpool thrash Brian Clough's Nottingham Forest 5-0 was Tom Finney who came away saying that he never thought he would see an English team play football of that standard at such speed. And as a winger for Preston North End and England, Finney had never been one to hang about.

The following season brought the Hillsborough disaster with the loss of 96 lives, a tragedy which left Dalglish so traumatised that he suddenly resigned on health grounds in 1991, although his management credentials were reconfirmed when he won the Premier League with Blackburn. Yet Liverpool FC have always been closest to his thoughts and his feeling for the club and its supporters was aptly summed up when he observed that "the people who come to watch us play, who love the team and regard it as part of their lives, would never appreciate Liverpool having a huge balance in the bank. They want every asset we possess to be wearing a red shirt, and that's what I want too."

Since returning to Anfield, following the end of Roy Hodgson's short-lived reign, Dalglish has been as good as those words. He wasted no time during the January transfer window signing a striker, Andy Carroll, from Newcastle for £35m and Luis Suárez, a Uruguayan artist, from Ajax for £22.8m, deals made possible by the departure of the forlorn Fernando Torres to Chelsea for £50m.

Some of the names have become more exotic and the players' fees and wages have soared beyond the stratosphere but little will have changed in the way Dalglish wants Liverpool to play. True the bench can no longer bark "step up, step up" to defenders on the safe assumption that opponents straying into offside positions will immediately be flagged by a linesman. And the use of the goalkeeper as a quarterback, picking the ball up from team-mates and instigating attacks with the sort of accurate throws which were Ray Clemence's speciality, has gone out of fashion with the restriction on back passes.

Yet when the summer transfer activity has Liverpool signing a quick, penetrative winger like Aston Villa's Stewart Downing and a studious Scottish creative player of the old school such as Blackpool's Charlie Adam, it would seem that Dalglish is seeking to rebuild the team along familiar lines. The best sides at Anfield have usually employed a quick, skilful wide man as an outlet – Billy Liddell, Peter Thompson, Steve Heighway and Barnes spring to mind – and Graeme Souness, whose pass set up Dalglish for the winning goal when Liverpool beat FC Bruges at Wembley in 1978 to retain the European Cup, was the epitome of the Scottish craftsman.

It would help if Dalglish could now find another Kenny Dalglish, but that is about as likely as Manchester United unearthing another Alex Ferguson.