Capped eight times by the All Blacks, Rush left the Auckland Blues to join the Cardiff Blues in 2005, having captained the Auckland team to NPC success in 2002 and then victory in the Ranfurly Shield and Super 12 title in 2003.
Standing 6ft 2in tall and weighing 112kg, the Auckland native made his international debut against Australia in 1998 and has, to date, made 96 appearances in the Magners League and Heineken Cup.
Commenting on Ulster's latest signing, director of rugby operations David Humphreys said: "Success in Northern Hemisphere rugby is built around the pack of forwards.
"Over the past number of seasons, Xavier has been one of the outstanding back row forwards in European rugby and his ball-carrying ability and leadership qualities will further strengthen Ulster's pack for next season.
"With the demands on players in the build-up to the 2011 Rugby World Cup and the increasing number of injuries in the professional game, it is vital to have depth in key positions throughout the squad and Xavier will also play an important role in developing Ulster's young back row forwards."
Ulster head coach Brian McLaughlin added: "Xavier will be a great asset to the Ulster back row. He is an aggressive, attacking player who has played his rugby at the highest level.
"He is a big hitter on the field and has been instrumental in the Blues' success in recent seasons. The management team is delighted to have a player of Xavier's calibre join our squad ahead of next season.
"The experience that Xavier will bring with him is of great value and importance to the Ulster squad now, and in terms of future team development.
"Having players of his talent about helps raise the bar for everyone, and develop our young players to the levels required to play Magners League and Heineken Cup rugby."
Speaking about his move to Ulster, Rush remarked: "I am delighted to have signed with Ulster, and I am looking forward to becoming a part of a team that has some great young players and plenty of ambition.
"The five years that I spent at Cardiff were terrific, but I felt like it was the right time for a change and a new challenge, and moving to a vibrant city like Belfast is going to provide me with that.
"Also, being on the right side of the Ulster fans for once is going to be great and I now look forward to making the move, getting out on the field and becoming an Ulsterman."