The southern franchise announced yesterday it would welcome back Japanese international Tanaka for a third season for the Highlanders in 2015.
Tanaka (29) has played 26 games for the Highlanders in the past two seasons though he has started only three games.
He was the first Japanese player to play Super rugby in New Zealand and will bring his family back to Dunedin, joining the franchise for pre-season training in December.
Tanaka was keen to return and told the Otago Daily Times earlier this year he was keen to live permanently in New Zealand.
He said in a statement yesterday he was excited to be back playing for the Highlanders.
''I have big passion for the team and Dunedin. Super rugby is very tough but I enjoy the challenge of playing against the best teams and players,'' he said.
Tanaka will be back-up to All Black halfback Aaron Smith and is also likely to start some games given Smith's workload is bound to be managed in a World Cup year.
Wellington halfback Frae Wilson will be the third halfback in the squad.
Highlanders general manger Roger Clark said Tanaka was keen to come back and once it was cleared by New Zealand Rugby the franchise moved quickly.
Yesterday, the Reds announced they have signed former Highlander Adam Thomson for next season.
Thomson was a standout loose forward for the Highlanders from 2008-12 and left a huge hole in the team during its forgettable 2013 season.
He played 67 games for the Highlanders and also 29 tests for the All Blacks.
Clark said the franchise never talked to Thomson and he was not somebody it chased.
''We have already got our loose forwards all signed up. We do not want to go backwards and that would be the case if we did look at Adam,'' he said.
''There is no doubt he was a great player for us but at the end of the day we got the best out of him.''
Clark said it was important the side got the mix right between youth and experience and that was especially so in the loose forwards.
He said Thomson was missed in the 2013 season but new players such as Shane Christie emerged last season.
Thomson will turn 33 in March and could have an early return to Dunedin as the Reds are scheduled to take on the Highlanders in the third round of next season's competition at Forsyth Barr Stadium.
Thomson may not be available as he will have to play out his season in Japan for Canon.
Clark said with the signing of Tanaka the 32-man Highlanders squad is nearly complete, with just a back and a lock to select.
The six members of the wider training squad have yet to be finalised, and will be named with the full squad on October 29.
