The veteran Brazilian fullback signed a two-and-a-half-year deal on Thursday and will don the number ten shirt at the club.
Having been linked with a move back to Barcelona after his spell with PSG, the former Bahia defender has returned to his boyhood club.
"Now, in 2019 I could have picked anywhere to play but I chose to return to Brazil. For my country. For my people. For the club of my heart.
"Today I close another cycle in my life, a cycle of victory, learning and experiences.
"I would like to thank the PSG family for the opportunity to together build a page in the history of this club.
"It was two years of resilience and continuous reinventing to fulfil my mission, but in life, everything has a beginning, a middle and an end and now the time has come to put that final point here.”
Delighted with the move was Sao Paulo’s president Carlos Augusto de Barros e Silva, stressing the versatile defender is always eager to win glories.
"Daniel Alves is the embodiment of what this management envisions for Sao Paulo – one of the leading players in the world and recognised for his immense professionalism, his fierce determination and his endless thirst for titles and victories.
"He is also a socially engaged citizen and passionate about our country.
"Sao Paulo, therefore, wins on every possible front.
"One day I told Daniel that he would come to play at Sao Paulo, his heart club.
"Today I have the immense joy and pride to have kept that promise."
In a successful football career, Alves is the most decorated footballer, having won 40 trophies in the sport.
The 36-year-old has featured for most European clubs with the likes of Barcelona, PSG, Juventus and Sevilla.
Alves was the captain when Brazil won the 2019 Copa America trophy on home soil in June as that was his 40th trophy as a player.
