Young, who played for Manchester United for nine years, adds valuable experience to Sean Dyche's squad as a winner of the Premier League, Serie A, Europa League, FA Cup and League Cup.
The 38-year-old moved to Inter Milan in 2020, becoming only the third Englishman to win Italy's top-flight title. He played the past two seasons at Aston Villa, who did not renew his contract when it expired last month.
"I know things haven't gone too well for Everton in the past couple of seasons but the manager's ambition, speaking to him and hearing what he wants to do to change the club around, was a key factor in my decision," Young told evertontv.
Young has made 422 Premier League appearances and ranks 15th in the competition's all-time assists with 71.
Everton finished 17th - one spot above the relegation zone - last season.
