He becomes the club's first piece of signing news ahead of the forthcoming season.
The club added: "This will be his eighth season with the Steels and the players will be looking to him for leadership in some of the tough games they’ll be facing this season.
"While McFayden didn’t play for Stocksbridge last season, he did have a brief loan spell with Athersley Rec over the Christmas period. He has also previously played for Worsborough alongside manager Chris Hilton."
Goalscorer Luke Mangham also recently re-signed with the club for the 2021/22 season.
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