As president of the University of Hawaii from 2001 to 2004, he backed unifying the system's campuses, established the Academy of Creative Media, built a new medical school, reformed financial and building practices and strengthened Native Hawaiian programs. He was also criticized for politicizing the university by endorsing Democrat Mazie Hirono for governor and for paying unusually high salaries to administrators (though typical by mainland standards). On June 15, 2004 Dobelle was fired by the Board of Regents, but this firing was deemed illegal and void. Turnover on the Board of Regents meant that there were no Regents left who had selected him as President. A few weeks later, Dobelle and the university reached a mediated settlement. Dobelle agreed to resign from the presidency and not to apply for any other University of Hawaii positions, and the university agreed to a two-year non-tenured research position and a settlement of $1.6 million in cash, a state pension for life, and a fully paid $2 million life insurance policy, and assumed all legal costs of $1.2 million, with no finding of wrongdoing on the part of either Dobelle or the board.