The 34-year-old rejoins the county six months after his previous deal was terminated, and he will be available for the start of the County Championship next month.
Confirmation of the move comes a day after Pietersen struck a deal to cancel most of his IPL contract with Hyderabad Sunrisers, and the aim now is to force his way back into the England reckoning.
Surrey will benefit from that ambition, according to Oval director of cricket Alec Stewart, who said: “A Kevin Pietersen with ambitions to play for England and a real determination to score big runs for Surrey will be a huge asset to us.”
Pietersen, who last played for England more than a year ago, said: “I???m absolutely thrilled to be back at Surrey. It???s a club very close to my heart and Alec Stewart, (coach) Graham Ford and everyone at the club has been exceptionally supportive.
“There is a fantastic group of lads here and hopefully we can deliver what the great Surrey fans want to see – lots of runs and comprehensive victories.”
Former India batsman VVS Laxman, team mentor at the Sunrisers, told Sky Sports News the IPL franchise did not want to stand in the way of Pietersen’s intenational ambitions.
“We were very exicted when we got Kevin in the auction, but we had to take this decision because Kevin is very keen to make an England comeback and the only way he can do that is by playing county cricket.
“The best decision was taken in the interest of both parties and I just want to wish Kevin all the best – I still think he is a fantastic player, and I think he has got a job left for England.
“The Ashes is going to be a highly competitive series, and if Kevin does well in domestic cricket I would like him to play against Australia and do well against them.”