The 20-year-old winger spent last season on loan at Dutch club NAC Breda, where he won promotion to the Eredivisie.
The player, whose move to Easter Road was revealed by the Evening News, also had a brief loan spell with Rotherham United in season 2015/16.
Hibs head coach Neil Lennon has been keen to add extra width to his squad following the departures of Chris Humphrey and Alex Harris at the end of last season and has swooped for Barker, a player renowned for his pace and trickery.
Barker said: “It feels great and I can’t wait to get playing football again. It’s a great club and a great city to be in, so I’m really looking forward to it.
“The manager said that it is a good place for me to come and carry on learning my trade and that it is a great platform for me to come and show everyone what I can do.
“He believes in me, so hopefully I can make everyone else believe in me.”