The 32-year-old Latvian has spent the last five seasons playing in Denmark, Sweden and France.
Mustukovs made his senior international debut in 2009 and has been a regular fixture in World Championship and Olympic qualification tournaments since then.
Steelers’ boss Paul Thompson said: “I think it’s well known that I tried to bring Moose here last year. Unfortunately we weren’t able to do the deal then, but we’re delighted to have landed him this summer.
“Moose is such a competitor. He stops the puck and he will bring a level of consistency to our goaltending that we need if we are to challenge and retain our league title
“It helps that he knows Sheffield and enjoyed his previous spell here. It helps me that I know him – know what to expect from him.
“Moose was excellent for me in Aalborg. He came to play every night and in my opinion was the best goalie in the league that year.”
Thompson also confirmed that Mutukovs would be partnered by the returning Brad Day next season.
“Brad had an excellent first year for us,” Thompson added. “He played valuable minutes and won us important points that helped secure us the title.
“In fact, I said after we lifted the trophy last year that he was the reason we had the success we did. He delivered for us and will only get better.
“Brad is a valuable member of the group and his partnership with Moose will be vital moving forward.”
(Image permission: Milan Kammermayer)