The 29-year-old two-time competition goalkeeper of the year won two A-League titles with Victory before an unsuccessful stint with England League One club Norwich City.
"I know there's a lot of rebuilding and it is a great opportunity for me to come back home and be involved in what I believe will be a successful team," an excited Theoklitos said.
"It's a very young and exciting team. With Ange Postecoglou being at the club I’m looking forward to the opportunity to be working with him.
"I always enjoyed playing Brisbane Roar at Suncorp Stadium because of the atmosphere the fans create."
Theoklitos will join his new team-mates for pre-season training in May as the squad begins preparations for the 2010/11 season.
Meanwhile, defender Luke DeVere took out the major honours at the club's awards night.
The 20-year-old took out the Gary Wilkins award for player of the year and also won the Roar Foundation Members Player award and the players' player gong.
"I’m very honoured to be accepting this award," DeVere said.
"I think had other players still been at the club I may not be standing here, but I feel extremely privileged to be doing so."
De Vere, 25 points, edged former Roar captain Craig Moore, 22 points, and newly-capped Socceroos winger Tommy Oar, 18 points, for Roar's top individual award.