He joined from Falkirk last season, but found first-team opportunites limited and was told he could leave on a free transfer in the summer if he could find another club.
McBreen will go straight into the Minstermen's squad to face Histon on Saturday, and could go straight into the starting line-up as they have three forward players ruled out through suspension and injury.
"Daniel's a player I have been looking at for a while," York boss Billy McEwan told the York Post.
"Scunthorpe have been trying to get a striker in so we've had to be patient, but they've got Ben May in from Millwall and that's enabled us to bring Daniel in. He was wary of coming into the Conference but we have persuaded him to join us.
"He got injured last season and could not get back into their team, but he's a big, strong Aussie and left-sided which is helpful. He gives us another avenue to go down in our squad and Scunthorpe need to get him out to play because he's only been getting reserve football."