Newcastle, who currently sitting 26 points clear at the top of the RFU Championship, are heavy favourites to win promotion back to the Aviva Premiership via the play-off system and Blair believes the move will offer him another fresh challenge at the back end of a stellar career.
"I am really enjoying my time in France but I feel that playing with Newcastle Falcons will provide me with a rugby challenge that I have been looking for. There has always been a strong Scottish influence at Newcastle Falcons and I am delighted to continue in that tradition," said Blair, who has played 21 timies for Brive this season.
"Newcastle have ambitions to challenge in the Aviva Premiership, and although there are still the play-offs to be played, they are in a good position to be promoted and to achieve this goal."
Blair's return to the UK is already leading to suggestions that an international recall could be on the cards, even though he retired from Scotland duty in January of this year. Blair remains his country's most-capped No 9 with 85 appearances, of which 14 were as Scotland skipper.
He is so far the only Scotsman to be nominated for the IRB World Player of the Year following a fine season in 2008 and was one of just four Scots who featured on the last Lions adventure to South Africa having been called up as a pre-tour replacement for the injured Tomas O'Leary.
Blair's switch to Kingston Park means he will renew his rivalry with fellow Scottish scrum-half Rory Lawson after Lawson joined Dean Richards' squad from Gloucester at the close of last season. Lawson and Blair were team-mates at Edinburgh before Lawson left for regular rugby at Gloucester in 2006.