At age 34, Eustachy became a head coach at Idaho in April 1990,[3][4] succeeding Kermit Davis, who left the Palouse for Texas A&M after consecutive Big Sky titles and NCAA tournament appearances.

[12][13] Eustachy was named head coach at Iowa State in late July 1998,[14][15][16] after Tim Floyd left for the NBA's Chicago Bulls.

After consecutive Big 12 Conference titles in 2001, he signed a contract extension that, with incentives, made him the highest-paid state employee in Iowa.

On April 28, 2003, The Des Moines Register carried pictures of Eustachy kissing several young women and holding a beer at a party near the University of Missouri's campus just hours after the Tigers defeated his Cyclones on Tuesday, January 21.

[19][17][20][21] On April 30, athletic director Bruce Van De Velde suspended Eustachy with pay and recommended that he be fired for violating a morals clause in his contract.

[22] Eustachy held a press conference in which he apologized for his behavior and admitted he had recently begun rehab treatment for alcoholism.

[25][26] During the scandal, the Register reported that Iowa State documents showed that the NCAA cited Eustachy for rules violations related to paying players, including Jackson Vroman, for making free throws.

[38] In February 2017, The Coloradoan revealed that a 2014 Colorado State internal investigation recommended Eustachy's firing due to creating a culture of fear and intimidation by emotionally and verbally abusing his players and staff.

However, Colorado State retained Eustachy and required him to attend anger management sessions, apologize to his team, and follow a zero-tolerance policy for directing profane language towards others or throwing or hitting objects, for which violations would result in termination for cause.

[2] On July 27, 2023, it was announced that Eustachy will be working with Leon Rice and the Boise State men’s basketball team as a volunteer senior advisor to the head coach for the upcoming season.