Buaben, 26, left Carlisle in May and Hearts head coach Robbie Neilson decided to act after the former Ghana international impressed during a fortnight's trial.
"He's been at training for the last two weeks and he's played a few games for us," said Neilson.
"He's looking good and he's a top player. He's played in the SPL for a long time and he's played in England at a very high level so I'm pleased to get him.
"He gives us a bit of strength in there. We've got some good options now in the middle of the field. He's a good character as well.
"If this is the condition he's in, having only trained for just over a week, then I'm looking forward to seeing what we can get out of him in two or three weeks' time."
Buaben moved to Dundee United in 2007, helping them to Scottish Cup success in 2010. He joined Championship side Watford in 2011 before moving north to Carlisle last year.
Watch Hearts open their Championship campaign in front of the Sky Sports cameras at Rangers on Sunday 10 August.