The 38-year-old former Cy Young Award winner agreed Thursday to a one-year contract with Boston.
"He wants to beat the Yankees," Boston general manager Dan Duquette said. "Why else would he sign with the Red Sox?"
Cone, who has five World Series rings, has a 184-116 record and a 3.40 ERA over a 15-year career but struggled last season, going 4-14 with a 6.91 ERA in 155 innings.
He did not start in the postseason, making just two relief appearances. One was key: In Game 4 of the World Series, he got Mike Piazza to fly out in the fifth inning.
"Obviously, we still think he has a lot left to offer," Red Sox pitching coach Joe Kerrigan said. "He's one of those class pitchers of the last decade, one of the clutch pitchers over the last decade. He's got something to prove, He said he was embarrassed with his performance last year. He has a lot of pride and he wants to show the world he's not a four-game winner."
The deal is not guaranteed, meaning Boston could release him during spring training and owe just termination pay. But if he makes the roster and pitches regularly during the season, he could make between $4 million and $5 million.
The Red Sox announced the signing at the 62nd annual dinner of Boston chapter of the Baseball Writers' Association of America. The crowd of almost 1,200 roared but not nearly as loudly as following the introduction of Manny Ramirez, Boston's new $160 million outfielder.
Cone will compete for a fifth spot in the rotation with Tomo Okha, Paxton Crawford, Tim Wakefield, Pete Schourek and Sun-Woo Kim. Boston's first four starters are Pedro Martinez, Frank Castillo, Rolando Arrojo and Hideo Nomo.
Cone had been with the Yankees since 1995 but he wasn't interested in returning to New York as its fifth starter next season. The Yankees wanted to cut his salary, which was $12 million last season, and offered a guarantee of only $500,000.
He lost eight straight decisions during a 15-start winless streak last season and just seemed to be regaining some of his form when he dislocated his left shoulder on Sept. 5 at Kansas City. Before last year, Cone had six straight winning seasons and had not had n ERA above 3.60 since 1987.
He threw last week for Duquette and manager Jimy Williams in Florida.
"He looks fine to me. He definitely looked good," Williams said. "His delivery looked cleaned up to me."
Cone won the AL Cy Young Award with the Royals in 1994, and has also pitched for the New York Mets and Toronto Blue Jays.
He had been courted by Texas, Kansas City and Montreal, with the Royals proposing to convert him to a reliever.
"It was the comfort level of the manager and the pitching coach, which was a major part of the decision," his agent, Steve Fehr said. "He turned down more guaranteed money elsewhere, this is where he wanted to be."
Cone is the latest reclamation project for Duquette, who also signed two-time Cy Young winner Bret Saberhagen when he was recovering from surgery.
"David Cone knows how to win a game," Duquette said. "He's won some big games in his career."
Cone was a leader on the Yankees as they won four World Series titles in the last five seasons, including the last three. Boston was impressed by his makeup.
"I never heard him alibi one time," Williams said. "He probably could have had more wins, but I've never heard him complain about one thing in his career."
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