Sproule left Ross County last month for personal reasons and returned to his native Northern Ireland after having his contract terminated by mutual consent.
The 32-year-old had held signing talks with League of Ireland pair Derry City and Sligo Rovers but has instead decided to settle at Windsor Park and a return to part-time football on an 18-month deal.
The Northern Ireland internationalist was plucked from obscurity by Tony Mowbray in 2005 for the bargain price of just £5000, and went on to lift the Coca-Cola Cup with the Edinburgh club in 2007 before leaving for Bristol City.
Jeffrey admitted he is thrilled to have finally landed a player he has chased for more than a decade. "We've signed him on our third attempt. I remember many years ago, the first time, when he was a fledgling young player with this massively exciting pace and ability.
"Then there was the second time. . . the club had done a deal with Hibs and I had actually confirmed it with their then-manager Tony Mowbray, only for Ivan then that Saturday to score a hat trick against Rangers at Ibrox.
"I remember very sheepishly going back to Tony Mowbray, knowing rightly what the answer was going to be to the question and was told the deal was off."