The 32-year old centre-back spent last season with Stoke City before his contract expired and he has now made the move back to the Riverside Stadium with the view of getting the club back into the Premier League.
"The pull of helping Boro back in the Premier League is very strong for me and from what I have seen of the current squad, I think it's achievable," Woodgate told the club's official website.
"Tony Mowbray explained his plans for next season and how he is building a team that wants to get back in the Premier League as soon as possible. I want to be part of that and if we can achieve promotion in my time here it will be a fantastic way to end my career.
"Tony also likes his teams to play football the right way, and that was also a big plus point for me. It's just a great feeling to come back to this football club."