Former Hartlepool midfielder Taylor is to join Allardyce, assistant Paul Bracewell and first-team coach Robbie Stockdale at the Stadium of Light.
He will take responsibility for sports science, strength and conditioning, medical, performance analysis and the first-team coaching staff as he links up with his former boss once again.
Allardyce said: "Areas such as sports science and performance analysis are absolutely crucial in the modern game
Mark has a tremendous amount of experience and expertise in these key disciplines and he will help us to ensure that our players reach their maximum potential.
"I am delighted to welcome Mark to the club."
Taylor, who also played for Crewe, Blackpool, Cardiff City and Wrexham, returned to education after hanging up his boots and graduated with a BSc in physiotherapy and an MSc in sports science before joining Allardyce at Blackpool.
His career since has seen the pair work together at Bolton and Newcastle, while he was also a member of now England boss Roy Hodgson's staff at Blackburn and Fulham.
Source : PA
Source: PA