The veteran goalkeeper left Juventus at the end of the 2020-2021 season and was reportedly approached by Turkish Super Lig giants Besiktas, and Flamengo.
The Italy great has instead chosen to return to Stadio Ennio Tardini, where he developed as a youth and spent six years in the senior team after making his debut back in 1995 at the age of 17, keeping a clean sheet against a Milan side featuring the likes of Roberto Baggio and George Weah.
Roberto D'Aversa, the Parma head coach, was a teenager on the Rossoneri's books at the time.
Parma announced the return of their "superman" via a video released on Twitter, showing Buffon digging up a time capsule buried beneath one of the goals at the famous old ground.
Buffon won the Coppa Italia, Supercoppa Italiana and famously the 1998-1999 UEFA Cup with Parma before leaving for Juve in 2001.
His glittering career in Turin included 11 league titles – one of which came when they topped Serie B in 2006-07, Buffon having stayed at the club despite their relegation due to the Calciopoli scandal.
Buffon also won five Coppe Italia, most recently last season, and six Supercoppe Italiana. He reached three Champions League finals with Juve, losing each one.
He spent 2018-2019 with Paris Saint-Germain, winning Ligue 1 and the Trophee des Champions, before returning to the Allianz Stadium two years ago.
A winner of the 2006 World Cup, Buffon's 176 Italy caps is a record for the Azzurri, his final appearance coming in a friendly with Argentina in March 2018.
Buffon, who turns 44 next January, will spend 2021-22 in Serie B, Parma having been relegated last season after winning just three games.