  We study a new version of the one-dimensional spin-orbital model with spins
S=1 relevant to cubic vanadates. At small Hund's coupling J_H we discover
dimerization in a pure electronic system solely due to a dynamical spin-orbital
coupling. Above a critical value J_H, a uniform ferromagnetic state is
stabilized at zero temperature. More surprisingly, we observe a temperature
driven dimerization of the ferrochain, which occurs due to a large entropy
released by dimer states. This dynamical dimerization seems to be the mechanism
driving the peculiar intermediate phase of YVO_3.
