Mitchell, who has won 15 caps for Wales, originally joined Yorkshire Carnegie in March at the end of last season making six appearances before joining the Falcons on a short term deal at the start of this campaign.
Making his professional breakthrough with the Ospreys, for whom he played 24 times in the Pro 14 and a further seven in Europe, Mitchell then moved to Exeter Chiefs, turning out 26 times in the Premiership and eight in Europe.
Switching to Cardiff Blues for two years and Newport Gwent Dragons for one, Mitchell will replace countryman Rowan Jenkins at Yorkshire Carnegie who has been released by the club so he can return home to Wales.
Director of Rugby Chris Stirling said: “We are very pleased to bring Craig back to the club. We were keen to retain him at the end of last season but unfortunately things did not work out but I am delighted to have a player of his experience and quality back on board now.
“I would like to thank Rowan Jenkins for his efforts since coming to the club and he leaves with our best wishes.”