Christian, 33, captained the side during this year's tournament and will be one of their two overseas players for the competition in 2017.
He averaged 41, with a strike-rate of 159.51, as Notts Outlaws won nine matches in a row in 2016.
"Dan is an explosive player who hits the ball miles and played really well for us," said head coach Peter Moores.
"He's also been around the T20 scene and around cricket for a long time. He brings all that experience to us, as well as a real calmness under pressure."
Christian has played 174 Twenty20 matches during his career, scoring 2,549 runs and taking 130 wickets.
He made three half-centuries for Notts last summer and equalled Alex Hales' record for the county's fastest half-century in T20 cricket by reaching fifty off 16 balls against Leicestershire.
"Anybody who has met Dan will know he's a brilliant team-man. He gives everything and expects the same from his team-mates," Moores added.
"He likes to get on the front foot, to be aggressive and to play attacking cricket, which is exactly what we want in that form of the game."

The film about a princess's mythical journey in ancient Polynesia took an estimated $81.1m (£65.3m) on its debut.
That makes it the second-highest Thanksgiving debut of all time, behind Disney's Frozen, which took $93.6m (£75.3m) on its release in 2013.
Some observers have said that Moana and its merchandise are appropriating Pacific Island culture.
Disney withdrew a children's costume promoting the film after activists branded it "brownface", or mocking of their culture by stereotyping.
The costume, a full-body suit with brown skin, traditional tattoos, grass skirt and bone necklace, represented the character Maui, considered a demi-god and ancestor by many Polynesians.
Disney said it regretted any offence.
JK Rowling's Fantastic Beasts and Where to Find Them fell to second on the US chart, taking $65.8m (£53m).
Gossip surrounding Brad Pitt's marriage break-up failed to spark a huge amount of interest in his World War Two romance Allied, which also stars Marion Cotillard.
It took $18m (£14.4m) over the long weekend, having cost $85m (£68.5m) to make, landing in fourth spot behind Doctor Strange.
Kyle Davies, Paramount's head of domestic distribution, said the film appealed to "older audiences" but noted those "don't storm the theatres [on] weekend one".
"I think they're going to take their time," he added.
Warren Beatty fared worse - his first film in 15 years, the 1950s Hollywood comedy Rules Don't Apply, took just $2.2m (£1.7m). The film is Beatty's first directed feature since 1998's Bulworth.
Bad Santa 2, released 13 years after the original and again starring Billy Bob Thornton, did a little better, taking $9m (£7.3m).
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Australia all-rounder Dan Christian will return to Nottinghamshire for next summer's T20 Blast.
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Disney's latest animation Moana dominated the Thanksgiving box office over the five-day US holiday weekend.