The 32-year-old, capped 109 by the Netherlands, moves to the Seville team after his three-year stay in Germany with Hamburg ended when they decided not to extend his contract.
Van der Vaart had gone back to the Bundesliga outfit for a second spell in 2012 from White Hart Lane, where he had been for two seasons before leaving halfway through his contract.
He was a big favourite with supporters in North London, scoring three goals in his first two derbies against Arsenal in a debut campaign that saw him net 15 times in total.
The attacking midfielder made a similar impact the following campaign, scoring 13 goals including another against Arsenal before he moved on.
Now back in Spain, the former Ajax youngster will play in La Liga for the first time in five years following a stint with Real Madrid between 2008 and 2010.
Van der Vaart is the first new signing Betis have made since they sealed promotion back to the top flight by winning the Segunda Division by two points from Sporting Gijon.
The Dutchman will be paraded to fans at the Benito Villamarin Stadium during a midday unveiling on Tuesday.