The 28-year-old former Republic of Ireland international was available outside the transfer window after being without a club since being released by QPR in May.
Miller will become John Hughes' sixth signing since he became Hibs boss this summer.
Hughes told his club's official website, www.hibernianfc.co.uk: "I am delighted that we have secured the services of a player with the experience and qualities of Liam Miller.
"I said at the end of the transfer window that we would not stop looking for the type of player we felt would enhance our squad, and I don't think there is any doubt that Liam will do that.
"When you look at the clubs Liam has played for, you know that he is a footballer of real quality, and at 28 years old is at an age where his best years are still ahead of him."
Miller added: "I am excited about joining Hibernian and have been very impressed with the set-up at the training centre and within the club.
"I'm really looking forward to playing football in Scotland again, and can't wait to start training with the boys and competing for a place in the team."
Born in Cork, Miller started his professional career at Celtic.
After making 26 league appearances for the Hoops in which he scored two goals, he moved to Old Trafford in July 2004.
But he failed to make an impact in two years with Sir Alex Ferguson's side, during which time he was loaned to Leeds.
He joined Sunderland in the summer of 2006 and was there for two and a half years until moving to QPR in January.
Miller could make his debut in Sunday's Clydesdale Bank Premier League game at Hamilton if international clearance arrives in time.