The 35-year-old returns to Leipzig, where he played on loan in the 2022-23 season, as a free agent following the expiration of his contract with Sevilla at the end of June.
Nyland became a national hero during Norway's historic run to the World Cup quarter-finals, saving a penalty from Brazil's Bruno Guimaraes in a dramatic 2-1 last-16 victory last month.
"When the opportunity arose to return to RB Leipzig, I didn’t have to think twice. I have many positive memories of the club and the people here, and I’m really looking forward to seeing them again," Nyland said.
Nyland has also played for Molde, FC Ingelstadt, Aston Villa and Reading. He has made 76 appearances for Norway.