The Yankees will need a third baseman to fill in for Alex Rodriguez, who is to undergo hip surgery and won't be available to return to the lineup until at least mid-season.
Youkilis, 33, spent nearly all of his nine-year major-league career with the Boston Red Sox, the Yankees' main rivals. He is a career .283 hitter with 148 home runs and 610 runs batted in and has been selected to the All-Star Team three times.
Youkilis played 122 games last season, 80 after being traded to the Chicago White Sox. He hit .235 with 19 home runs and 60 RBI overall in 2012.
Financial terms of the deal with the Yankees weren't released but the New York Daily News said it was worth $12 million.