The 40-year-old Ibanez agreed to a $2.75 million deal, MLB.com reported.
The 17-year MLB veteran, who played for the Mariners from 1996-2000 and 2004-08, is coming off a successful year with the New York Yankees -- especially in the post-season, when he bashed three homers and drove in five runs while hitting .318 for the American League East champs.
He sports a career .278 average with 271 home runs and 1,116 RBI over 1,975 games.
To make room for Ibanez, the Mariners designating right-handed pitcher D.J. Mitchell for assignment.