Stoney, who has spent the last three seasons with Arsenal Ladies, joins Scott Rogers’ side after helping the Gunners win the FA Women’s Cup in 2016.
The 34-year-old is a vastly-experienced defender who has also previously played for Charlton Athletic Ladies, Chelsea Ladies and Lincoln Ladies.
Stoney, an MBE, has played for England in the last three Women’s World Cups, and came off the bench to help the Lionesses beat Germany to take the bronze medal in 2015.
On joining the Reds, Stoney said: "This is a great move for me, joining a fantastic club, and I am really excited for the new season.