The 32-year-old former New Zealand captain made 394 runs in 10 matches for Sussex last season at an average of 56.28, with a best of 93 not out against Gloucestershire in a 48-ball innings which included eight sixes.
Despite those runs, Sussex failed to get out of the group stage and Taylor is keen for an improved showing as he renews his relationships with Sussex captain Luke Wright and coach Mark Davis.
"I am delighted to be returning to Sussex for the 2017 NatWest T20 Blast," he said in a club statement. "I really enjoyed my time on the south coast last season and hope we can really make an impact in the Blast this coming campaign.
"The squad is looking very strong with a great balance of experience and exciting young talent. I can't wait to join up with Luke, Davo and the rest of the staff once again."
Davis added: "We are thrilled to have Ross joining us for the T20 competition. He was outstanding in the competition last season and to have him back is brilliant for the club.
"Not only is Ross a world-class player, but a fantastic role model to our younger players."
First Published: February 1, 2017, 9:57 AM IST