The highly rated player has spent his entire professional career at Dale and returns to Wanderers having briefly spent time in the academy as a youngster.
In total for Rochdale, he scored ten and assisted thirteen in 121 appearances.
Upon his arrival, Ian Evatt told the official site:
“Thank-you to the board for enabling this to happen. We feel like we’ve got a very good player on our hands,” said Wanderers’ manager Ian Evatt.
“He’s ready to make a difference. He’s not one with an eye on the future. He’s one to come in and make a difference right here, right now, and that’s what we want.
“He’s very experienced for someone so young and played a lot of his games in League One.
“He has huge talent and is very much our type in terms of he can handle the ball, can pass and break lines, has great vision and a great array of passes and we’re looking forward to working with him.
“We’re delighted he’s come back. We’re thankful to get him back and he will develop into a very good player for this football club and a huge asset.”