"He has signed a two-year contract at Spotland, with the transfer fee not disclosed.
The move reunites him with Dale boss John Coleman, who was his manager at Accrington Stanley before his move to the Iron in the summer of 2010.
“It has been a frustrating two years for me but I have grown as a person, the move up there [to Scunthorpe] was a good experience, I have learnt a lot as a player and as person, and when I got the call off John it was a no brainer," Grant told Rochdale's official website.
He made 70 appearances for Scunthorpe, netting 11 times. He had a two-month loan spell at Spotland in 2010 after finding himself out of the first-team picture at the Iron, and was happy to be back in Lancashire.
“I had a great time. I scored some goals, the fans were great with me, the staff behind the scenes and everyone around the club were great with me," he added.
"John Coleman has been positive in getting me back here and I just can’t wait to get started."
It was unclear whether Grant would make his first appearance as a permanent Dale signing on Saturday.
The transfer was announced before the 12noon registration deadline, but the club had not said whether he had been registered with the Football League.