Folan, who has been without a club since leaving Malaysian Super League side T-Team earlier this year, has put pen to paper on a deal until the end of December, subject to international clearance.
The 30-year-old has been training with the League One side and Bantams boss Phil Parkinson hopes he will offer his team an extra dimension up front.
"Caleb is a powerful striker who will add a different option to our front line," Parkinson told Bradford's official website.
"He has been playing his football abroad for the last couple of years and he is now very keen to rebuild his reputation back in this country.
"He has looked great for us in training and we look forward to working with him on a more permanent basis now.
"We've been looking for someone to give us that little bit extra competition up front and Caleb gives us that. He has the strength to be a real handful for defenders to deal with."
Folan lists Chesterfield, Wigan, Hull and hometown club Leeds - amongst others - as former employers.