Cole, 30, left Upton Park at the end of last season after seven years with the club.
West Ham boss Sam Allardyce had hoped to bolster his forward line in the transfer window and did complete the signing of Andy Carroll on a permanent deal from Liverpool following a successful loan spell last term.
However, Carroll's continued absence through injury has left the London side struggling for strength depth up front, with Mali international Modibo Maiga leading the line for much of the campaign.
West Ham announced last month that Cole was training with the club in a view to a deal.
And Cole's return has now been confirmed after he successfully proved his fitness.
"I'm in an excellent mood, am happy to be back and can't wait to get working with the lads again and start my season off," Cole told the club's official website.
"I feel fit and raring to go and it's time to start knocking on the manager's door to get some games under my belt.
"I'm definitely excited because there are top-class players here and it's good to be playing and stable in the Premier League and looking to progress and do better than last season.
"We've got the players to do that and hopefully I can be a part of it."
Cole made over 230 appearances in his first spell with West Ham, scoring 59 goals.
The former Chelsea, Charlton Athletic and Aston Villa man could feature when West Ham host Manchester City on Saturday.
