The ex-Burnley boss was relieved of his duties earlier this week after a two-year stay with the Blues.
Moyes returns to Goodison Park after departing in 2013 after 11 years with Everton.
"It’s great to be back! I enjoyed 11 wonderful and successful years at Everton and didn’t hesitate when I was offered the opportunity to rejoin," Moyes said in a statement.
“I’m excited to be working with The Friedkin Group and I am looking forward to helping them rebuild the club.
“Now we need Goodison and all Evertonians to play their part in getting behind the players in this important season so we can move into our fabulous new stadium as a Premier League team.”
The Scotsman left the Merseysiders for Manchester United to replace compatriot Alex Ferguson, who was retiring after a glittering 27-year career with the Red Devils.
Moyes would leave Old Trafford just a year after he arrived following an abysmal turn of form.
More recently, the Scot managed West Ham across two stints from 2017 to 2018 and 2019 to 2024.
With the Hammers, Moyes claimed his first major managerial honour by winning the Europa Conference League in the 2022/23 season.
The Scot re-joins Everton with the club slumped in 16th place in the Premier League.
“We are pleased that David is joining us at this pivotal time in Everton’s history. With over a decade of experience at the club, he is the right leader to propel us through our final season at Goodison Park and into our new stadium," said Executive Chairman Marc Watts.
"We look forward to working with David to build the foundation of a new era for Everton.”
The Blues are next in action against Aston Villa on the 15th of January.