The 31-year-old has helped Leicester to two successive Premiership and Heineken Cup titles after arriving to fill the gap left by fellow Australian Pat Howard in 2001, and teams up again with former Brumbies Chief Executive Mark Sinderberry in his new role, which will see him look after the club's backs.
Owner Nigel Wray has been searching for the winning formula without success for a number of years at Saracens, who have made at least some strides under Kiwi coach Wayne Shelford, but found themselves dragged into the relegation fight towards the tail end of the campaign.
Kafer takes the place of another Australian at Saracens, with Wallaby legend Tim Horan almost certainly heading back home, but Kafer is looking forward to his new challenge, which will see him link up with former Leicester fly-half Andy Goode.
"I'm very pleased to have signed for Saracens, and I'm very much look forward to meeting up with the guys," said Kafer on his move south.
"I know a fair bit about the history and the players at the club, so not too much is new to me there.
"With Saracens I have the opportunity to try something new and different. There's a squad with much potential, and I'll be seeing what we can do to help develop that potential."
Nicknamed 'Tugboat', Kafer claimed 12 Wallaby caps between 1999 and 2000, but it would have almost certainly been more had it not been for the presence of reliable Test performers like Horan, Jason Little and Daniel Herbert to name a few.
He helped the Brumbies to lift the Super 12 title back in 2001, and Sarries Chief Executive Sinderberry said of his arrival at the club: "We're very pleased to be able to announce that Rod has signed for Saracens.
"During the Rugby World Cup we will have several players away and he will be very useful to us, and provide excellent leadership in this period.
"In the second half of the year he will work with the coaching team, and we're sure his insights to the game will be very valuable to us."
News of Kafer's arrival will no doubt fuel existing rumours that Wales centre Tom Shanklin may be on his way out, with persistent reports in the media that Cardiff may be his destination, although neither party has to date commented on the speculation.
Saracens' current centre contingent also includes England squad member Kevin Sorrell, who will be in action on Sunday as they travel to face Newcastle Falcons at Kingston Park.
By Mark Smith