Prior to joining Hull, The 6ft2 player had spells at Huddersfield, Mansfield Town, Leicester City and Stockport County after moving from his home club Cork iin Ireland as a teenager. Delaney's last cap for his country came against Colombia in May 2008.
Confirming the news to the Official Club Website, Town's second signing of the summer said: "I'm looking forward to the next step in my career here at Ipswich Town.
"I have spoken to the manager, Roy Keane, and it's clear that this club is very ambitious and I'm delighted to be part of trying to take the Club forward."
Meanwhile Town boss Roy Keane said of his second signing in as many days following yesterdays signing of Troy Brown: "I'm delighted that Damien has agreed to join us. He's a player that I have kept an eye on for a while and I'm sure he will prove to be a valuable addition to our squad."
Click here for a full player profile on Town's newest signing.