The 22-year-old defender, who came through the club's academy and was tipped to follow in the footsteps of John Terry, was rewarded after making seven appearances for the reserves following a significant improvement in a knee problem that saw him announce retirement in August 2010.
Hutchinson continued to work at the academy and was pursuing coaching qualifications before the decision was taken that he was able resume competitive football. Hutchinson told the club's official website, www.chelseafc.com: "It is great news I have signed a contract."
He added: "It is great to be back and I am looking forward to the future. I take it week by week and it is a slow process. I am still not out of rehabilitation but I am playing 90-minute games and feeling really fit.
"I have progressed from a month of three days training and then a day off to four days training and then a day off, so everything is going really well. It is important now to stick to the plan and listen to the doctors and progress from there."
Hutchinson will continue to be part of the reserve team squad under the management of Dermot Drummy.
"I want to thank (academy manager) Neil Bath - he has been brilliant with me and I don't think I would be here without him," Hutchinson said. "And my family and Dermot have been great as well, as have Chelsea as a whole."
Bath added: "Sam signed a one-and-a-half year contract and, should he make progress, we anticipate there could be a further contract but he is still going through the very end stages of rehab and he is still not training with first-team-type loading in terms of intensity and demands.
"The plan is that Sam will gradually build up training intensity going into January. He was coaching a little and realised that the pain wasn't there anymore and although it is fantastic news because we have a player who has been with us since he was seven who we thought had retired, it is a case of every six weeks, let's visit where we are at.
"It is looking good that he will have a professional living in the game but we have to stay patient with the plan."