The versatile 27-year-old, who can play at centre or in the back row, has been with Bradford Bulls since 2013.
Blythe scored 12 tries in 60 appearances during his first spell with Warrington, his home-town club.
"There was always some desire from both sides for Matty to return once he'd gained some more experience," head coach Tony Smith told the club website.
Super League club Warrington Wolves have re-signed Matty Blythe on a one-year deal for the 2017 season.