The explosive short-form star has played a pivotal part in the Scorchers past two seasons, taking a total of 17 wickets with best figures of 2-15.
Willey said there was a host of reasons why he wanted to return for the Club's BBL title-defence.
"I'm really pleased to be heading back to Perth it's such a great competition and great place to play cricket and I absolutely love playing for the Scorchers," Willey said.
"It's one of the best groups of lads I've ever played with over my career and I love playing under JL.
"I think the Big Bash is the best T20 competition in the world. The crowds, the following; everything about it is fantastic and obviously the weather is fantastic, so you're guaranteed to play a lot of cricket.
"I was sitting at home on the sofa thinking about what the Scorchers side will be and I was thinking I might not get in the team now. The challenge to get in the playing side will be tough but that's good to be a part of.
"It means a lot to play in the last Big Bash season at the WACA Ground.
"It will be exciting to go to a new stadium with bigger capacity but the sea of orange at #TheFurnace is brilliant."
The Scorchers also confirmed Willey's signing would be the only overseas appointment to the squad, which includes 15 players with international experience.
General Manager – High Performance Ben Oliver said: "We're thrilled to have David back again - he is an exciting T20 cricketer and a great character who fits well with our squad.
"Our overseas players have all been very good, however we have a fantastic group of local players who have performed exceptionally well.
"They love playing together for the Perth Scorchers and we have great belief in them individually and as a team."
Willey's signing takes the Scorchers roster to 16 of 18 spots, with two more local players to be announced.
The Scorchers' opening BBL game is a rematch with last season's Final opponents the Sydney Sixers at the SCG on 23 December, before the side returns to Perth for its first home game at #TheFurnace against the Melbourne Stars on Boxing Day.
Perth Scorchers KFC Big Bash League squad: Adam Voges ©, Ashton Agar, Cameron Bancroft, Jason Behrendorff, Hilton Cartwright, Nathan Coulter-Nile, Mitchell Johnson, Michael Klinger, Mitch Marsh, Shaun Marsh, Joel Paris, Jhye Richardson, Ashton Turner, Andrew Tye, Sam Whiteman, David Willey.