Hall was previously assistant manager to former Colne boss Steve Cunningham for a 17-month period.
He said: “I am delighted to return and support the new gaffer at a club that is very special to me.
"I am coming in at an exciting time and my immediate focus will be looking to help Nathan and the club build on the foundations that have been laid over the last few years.
“I feel like I’ve some unfinished business at the club and would love nothing better than to help the club in its quest, both on and off the pitch.”
Chairman Ryan Haigh added “I’m delighted Kyle has agreed to return to Colne.
“His knowledge of the league will no doubt be of benefit to Nathan and knowing his affiliation with the Red Army, I know they will also be thrilled with the appointment.”
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