The 24-year-old former Blackrock College centre has represented Ireland at Under-19, Under-20 and Sevens level.
He was part of the 2007 Ireland Under-20 Grand Slam-winning team alongside current Connacht players Andrew Browne, Paul O'Donohoe, Thomas Anderson and Niall O'Connor.
His new contract will see him play at the Sportsground until at least the end of the 2011/12 season.
Speaking about the signing, Connacht head coach Eric Elwood said: "I'm really looking forward to working with Kyle again, having known him since the 2007 Under-20 team that won the Six Nations.
"I'm sure he will fit nicely into the squad. We're looking forward to him joining up with the team and working with him again."