The 19-year-old played 14 games during two short loan spells at Ewood Park last term.
And Rovers manager Gary Bowyer has made the right-back his fourth signing of the summer.
Bowyer told his club's website: "First of all we've got to thank Chelsea once again, because they've been more than accommodating.
"With the new manager coming in, we were waiting to see if Todd was going to be part of his plans, but they see the advantage of him coming out and playing in the Championship again for a full season.
"Todd kicked on massively when he came and joined us last time. On the back of his performances here, he earned himself a new contract at Chelsea and rightly so.
"We'll be looking for him to come and make the same impact as he did last season.
"He's an infectious character, he's a great footballer and we're delighted to have him, because he's the right type of person to have on board and he cares about the club, which is important."
Kane has been cleared by Chelsea to appear for Blackburn in the Capital One Cup and the FA Cup.