The 35-year-old, who retired from Test rugby last year following 101 appearances for Wales and four for the British and Irish Lions, returns to the UK after a stint in New Zealand with the Crusaders.
"I'm excited to join Quins and I'm grateful for the opportunity to continue my career with such an iconic club," Halfpenny told the London team's website.
"I have always admired the Premiership and I'm keen to grab this opportunity with both hands and contribute to the Quins DNA. I'm looking forward to getting stuck in and running out in front of a packed Stoop."
Although he is best known as a full-back, Harlequins hope the much-travelled Halfpenny -- who has also played for Cardiff, Toulon and Scarlets -- can provide cover across a number of positions in the back-line.
"We're thrilled to welcome Leigh to Quins," said coach Danny Wilson. "His experience speaks for itself and he will bring plenty of leadership, expertise and high standards to our squad.
"He's an incredible athlete, highly skilful and adaptive across multiple positions. We're confident he'll make a strong impact at Quins this season."
Harlequins finished sixth in the 10-team Premiership last term, five points off the top four clubs that contested the title-deciding play-offs.
