The 27-year-old mutually parted ways with the Kumasi giants after last season following lack of playing time.
Hearts communication director Kwame Opare Addo lauded the qualities of Quao and believes he will be instrumental in their bid to end a run without a major trophy since 2009.
"It's true that Evans Quao has been signed by Hearts of Oak and will be part of the squad for the new season," Addo told Goal.
"There is no doubt about his qualities because he is one of the best centre-backs in the country currently.
"Following the departure of some key players, we believe that he is the right replacement and the technical team are full of praise of his commitment.
"Looking at his track records, he brings a lot of experience to the team and will be very useful as we hope to win titles in the upcoming season in order to make the supporters happy for the first time in almost ten years," he added.
Quao, who previously played for Medeama, will have to shrug off competitions from Robin Gnagne, Fatawu Mohammed and Inusah Musah to earn a starting role.