The 21-year-old has been earmarked as a long-term signing to add competition to the Reds' forward ranks and after some complicated negotiations with City and Boro, a deal has been brokered to satisfy all parties.
There was no recall clause inserted in the season-long deal which took Miller to Valley Parade last summer.
But following talks, an agreement has been reached where Barnsley have agreed to pay Boro a fee for Miller, believed to be around £250,000 plus add-ons and immediately loan the Lancastrian back out to City.
Miller has scored six goals in 34 appearances for the Bantams so far this season.
Miller, who has penned a three-and-a-half-year deal, said: “I would like to thank Bradford for allowing me to take up a longer-term offer for 2019 and beyond.
“However, I am pleased to be staying here until the end of the season - and am up for the fight. I am determined to help keep the club in League One.
“I am enjoying my time with City and our form has really improved over the past couple of months.
“We are pulling together and working hard in order to keep picking up results.”
City manager David Hopkin added: “George being signed by Barnsley is testament to the hard work he has put in and the efforts the coaching staff here have put into him.
“We are delighted to have him on board for the next four months, though, and it is pleasing he has chosen to stay with us.”