United were looking to fill the void left by Paul McShane, who previously held the same role at the club before opting to call time on his career this summer.
Huddlestone, 35, is registered to play in the Under-21 set-up as an over-aged player with clubs permitted to utilise five over-aged outfield players and one goalkeeper.
Over the moon to announce I have been given the opportunity at this amazing football club to help coach and develop the next generation of talent coming through the system," Huddlestone tweeted.
"Grateful and honoured, now time to give back to the younger generation #MUFC."
The midfielder left Hull at the end of last season after completing a second stint with the Tigers following a four-year spell between 2013 and 2017.
Capped four times by England, Huddlestone made just 11 appearances last term as Hull finished 19th in the Championship and whilst in the twilight of his career and eyeing a move into coaching, the Old Trafford role could be the perfect catalyst for life after the game.
The deal means Huddlestone is not available for the first team and despite Man United currently in the market for a midfielder, Huddlestone instead will be involved in daily training sessions with United's new crop of talent.
Huddlestone's experience will be invaluable to the club's starlets as they look to catch the eye of first-team boss Erik ten Hag.
Having a player-coach within the academy set up was an idea implemented by United's head of Academy Nick Cox with the appointment of McShane the first step in trialling the initiative.
McShane's return to the club in the hybrid role was deemed a success with the Irishman now taking up a full-time role as the club's Professional Development Phase coach.
In June, Liverpool made a similar appointment with Jay Spearing penning a deal to return to Anfield as part of the under-23 set-up, having left the club in 2013.
Southampton also followed the same trend when they gave defender Ollie Lancashire the chance to take up a similar role at St. Marys.