Sharp, 27, will now remain with Doncaster until the end of the current season.
In January 2012, Sharp left Doncaster for promotion-chasing Southampton, who stumped up a fee of £1.8m to land the popular poacher.
Following his move to the south coast, Sharp scored nine goals in just fifteen games, providing crucial goals in Southampton's pursuit of Premier League football.
It was promotion to the Premier League that ultimately cost Sharp his place in the Southampton first team set-up. Jay Rodriguez and Emmanuel Mayuka joined the club that summer, and Sharp became marginalised.
He joined fellow Championship side Nottingham Forest on loan last season, scoring ten goals in thirty-nine league games.
This season Sharp was once again farmed out, as new boss Maurico Pochettino signed Dani Osvaldo to further add to Sharp's south coast woes.
Sharp admitted that he had a desire to one day return to the Yorkshire club from which he signed for Southampton, but that day has perhaps come sooner than many Doncaster fans expected.
In a closely guarded deal, Doncaster saw off attention from other Championship clubs to ensure that Sharp would be returning to the Keepmoat Stadium.
Doncaster Rovers manager Paul Dickov said:
“The fact that Billy knows the club so well and has such a fantastic relationship with the fans will hopefully mean he can hit the ground running straight away.”
“At this point I have to go on record and thank Gavin and the owners, for their continued support in this transfer window. They confirmed they were willing to support me in the window and have certainly done that through securing Richie Wellens, Gabriel Tamas, Abdoulaye Meite and Billy Sharp already this month. I also want to thank those at Southampton for helping to complete the deal.”
Sharp's first involvement after his return to the club is likely to be in this weekend's trip to manager-less Blackpool, who sacked Paul Ince yesterday.
Are Donny fans delighted by Sharp's return?
image: © Kevin NEAGLE