Zlatan Ibrahimovic was at Serie A side Milan from 2010 to 2012, scoring 42 goals in 61 league games for the club.
The Swedish legend, 38, flew into Italy for his medical earlier on Thursday ahead of signing a new deal.
The former Manchester United striker had been a free agent after his contract with the LA Galaxy expired.
After undergoing a medical, Zlatan was pictured with senior members of the AC Milan set up, including Paolo Maldini and Ivan Gazidis.
The striker, who scored 56 goals in 85 matches and won Serie A in 2011 with Milan, was also pictured holding up the home kit.
It was revealed that the veteran striker will wear the No21 shirt for the rest of the season.