Lynch's contract is for this season only -- Week 17 against the San Francisco 49ers and the postseason, a source told ESPN's Adam Schefter.
The Seahawks also signed Robert Turbin, who spent his first three NFL seasons with the Seahawks. Lynch and Turbin fill backfield spots that opened Sunday when Chris Carson and C.J. Prosise suffered season-ending injuries.
Lynch, who was in Seattle on Monday to take a physical, spent parts of six seasons with the Seahawks from 2010 to 2015, helping the team reach two Super Bowls. The five-time Pro Bowler came out of a one-year retirement to play for his hometown team, the Oakland Raiders, in 2017 and 2018.
Lynch, 33, hasn't played this season but didn't file retirement paperwork with the league.
In an interview posted by Beast Mode Productions on YouTube on Monday night -- the caption says the chat took place "a few days ago" -- Lynch was asked about a new opportunity and why he'd consider returning to Seattle. He responded: "We got history there. We got unfinished business."
The Seahawks (11-4) were desperate for help at running back as they prepare for their showdown Sunday night against the 49ers (12-3) in a game that will determine the NFC West champion.
Coach Pete Carroll confirmed Monday that Carson suffered a season-ending hip fracture during a loss to the Arizona Cardinals on Sunday. Seattle also is without backups Prosise (arm) and Rashaad Penny (knee), both of whom are out for the rest of the season.
Lynch rushed for 376 yards and three touchdowns in six games with the Raiders last season. He eclipsed 1,200 yards rushing in four consecutive seasons with the Seahawks from 2011 to 2014 and led the NFL in rushing touchdowns in 2013 and 2014.
"He's had plenty of time to be working and get ready in case something came up, and I'm anxious to see him when we get him here," Carroll told 710 ESPN Seattle earlier on Monday. "There's a lot of history here that's great history. There was nobody that ever amplified the kind of mentality and toughness that we like to play with, so if we get a chance to get the Beast back on the field, we'll see how that works out."
Turbin, 30, was a fourth-round pick by the Seahawks in 2012, part of the famed draft class that also included Russell Wilson and Bobby Wagner. Turbin rushed for 928 yards on 231 attempts (4-yard average) in 48 games with Seattle while serving as Lynch's primary backup. That included a career-high 310 yards in 2014.
Turbin spent three seasons with the Indianapolis Colts from 2016 to 2018, averaging 3.1 yards per carry over 23 games. He last played in Week 6 of the 2018 season.
Turbin and Wilson were roommates on road trips and became close friends during the running back's three seasons in Seattle. He was part of Wilson's wedding party when the quarterback married singer Ciara in 2016.
Turbin posted to Instagram a picture from inside the Seahawks' locker room Monday evening, indicating he had returned to the team.
Also Monday, Carroll said he expects defensive end Jadeveon Clowney to play against the 49ers after missing the Cardinals game with a core-muscle injury he has been dealing with since Week 10. That was the first meeting against San Francisco and Clowney's best game of the season.