Dunham made the team after joining the Islanders in training camp as a non-roster invitee. The nine-year NHL veteran played in New York's first three pre-season games and was in uniform again Friday when the Islanders faced the New York Rangers.
He was 1-1 in his first three outings, allowing six goals on 36 shots for a 4.09 goals-against average. Dunham will serve as the backup to starter Rick DiPietro, who earlier this month signed a 15-year deal with the Islanders worth US$67.5 million.
That contract was worked out with team owner Charles Wang along with Snow, who until this summer was DiPietro's understudy. But when Wang fired Neil Smith as GM just weeks after hiring him, he turned to Snow - who immediately hung up his skates and pads.
"It became clear in the past few weeks that signing Mike was a priority," Snow said in a statement. "He possesses all the characteristics that we look for in a player and has already shown that he'll be an asset to our club."
During his NHL career, including stops with New Jersey, Nashville, the New York Rangers and Atlanta, the 34-year old Dunham has a goals-against average of 2.69 and a .908 save percentage. Last season with the Thrashers, Dunham was 8-5 with a 2.77 GAA and .893 save percentage.
He was still sporting his Thrashers mask when he faced the Rangers at Madison Square Garden on Monday. DiPietro started in the rematch Friday as Dunham watched from the bench.