The Germany forward failed to live up to expectations since moving from Leipzig to Stamford Bridge for a fee of £47.5million (€50m) two years ago.
Although reports suggested his return would initially be on loan with an option to buy, the Bundesliga club have instead secured him on a contract that expires in 2026.
The 26 year-old scored just 10 Premier League goals in 56 appearances for the Blues, having arrived at the club with 95 goals for Leipzig between 2016 and 2020 to his name – that remains a club record.
Werner was not included in Thomas Tuchel's squad for Chelsea's 1-0 win over Everton in their first game of the Premier League season, and he said farewell to the club in a social media post on Tuesday.
Werner wrote: "Dear Blues, today marks the end of my journey with Chelsea FC.
"I am incredibly grateful for the time I spent at this special club. At this point I would like to express my appreciation for my teammates, the coaches and staff, and especially for you, the special supporters of Chelsea Football Club.
"I felt so much love and support throughout the last two years and I will never forget how you guys stood behind me in good and in challenging times!
"We lifted trophies like the Champions League together and I will always remember the song you wrote and chanted for me. I'm already looking forward to hopefully playing at Stamford Bridge again one day! See you soon, Timo."
Soon after, Leipzig confirmed the transfer had been completed.
Their statement read: "Timo is back – and is now snapping again for RB Leipzig!
"Our record goalscorer (95 goals) is returning to the Bundesliga after two years in the English Premier League with Chelsea and is again hunting for goals for the Red Bulls.
"The attacker has signed a four-year contract until 2026."
Despite Werner's failure to live up to the hype after his £47.5m (€50m) switch to Stamford Bridge two years ago, his tally of 23 goals in all competitions since he joined Chelsea is the joint-highest in the Blues' squad, alongside Kai Havertz, who also arrived from the Bundesliga in 2020.
With 17 assists, Werner has directly contributed to 40 goals in his 89 appearances, putting him behind only Mason Mount (46 goal involvements in 108 games).
Only Mount has had more shots than Werner (191) in the last two seasons for Chelsea, though the former Stuttgart star converted just 12 per cent of those efforts while missing 32 big chances (defined by Opta as an opportunity from which a player would be reasonably expected to score), showing his profligacy in front of goal.
Werner scored 28 Bundesliga goals in his last season with Leipzig, outperforming his expected goals (xG) of 21.